Understanding The Medicare Part D-IRMAA
If you choose to enroll in a Medicare Supplement Plan, you will be required to also take a Prescription Drug Plan (Medicare Part D Plan). Medicare Part D Plans charge an additional monthly fee, that varies based on which particular drug plan you choose to enroll in. Remember, Medicare Supplement and Part D Plans are in addition to Medicare Part A & Medicare Part B.
How much does a Medicare Part D Plan cost?
For the majority of people, you will only pay your Medicare Part D premium. It’s important to know that if you have a Medicare Supplement Plan, you must take a Medicare Part D Plan with it, when you first become eligible, or else you may face late enrollment penalty fees.
What about a Medicare Part D-IRMAA?
For some people, whose gross income is above a certain amount, you may have to pay a Part D income-related monthly adjustment amount (commonly known as a Part D-IRMAA). Part-D IRMAA is calculated by your reported gross income from your IRS tax return from 2 years ago. For those you do make above a certain amount, you will have to pay the Part D-IRMAA amount in addition to your monthly Part D Plan premium. The Part D-IRMAA is paid directly to Medicare, since it is run by the government.
If you are responsible for a Part D-IRMAA, Social Security will contact you directly and let you know the exact amount you have to pay based on your income. The Part D-IRMAA amount you are responsible for paying can change year after year. If at any point you feel you are paying too much for your Part D-IRMAA, (if for instance, your income level goes down), you can always contact Social Security to get it reconsidered.
Most people get the Part D- IRMAA amount taken from their Social Security check directly. It is not part of your plan premium, it is completely separate. If you do not get the Part D-IRMAA amount taken from your SS check, you will receive a bill directly from Medicare or the Railroad Retirement Board and you will be responsible for paying it, in order to keep your Medicare Part D coverage.
Get your Part D Plan premium automatically deducted
If you would like your Part D premium deducted directly from your monthly Social Security payment, you need to contact your drug plan (not Social Security). Typically it takes 3 months to start the deduction, so don’t be alarmed when your first deduction is 3 months worth. After the third month, only one premium will be deducted each month.