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2020 Medicare IRMAA: Part B and Part D Premium Brackets

Christian Worstell by Christian Worstell    |    Published Oct 30, 2019    |    Reviewed by John Krahnert

The 2020 Medicare IRMAA (Income-Related Monthly Adjusted Amount) is the additional surcharge some higher income earners pay on top of their Medicare Part B and Part D premiums.

This IRMAA surcharge is in addition to the standard Part B premium and any premium associated with their Part D plan. 2020 IRMAA amounts are based on a beneficiary’s reported income from 2018.

In 2020, the income brackets that determine Medicare IRMAA costs will be indexed according to inflation. This change could mean fewer Medicare beneficiaries will pay IRMAA surcharges, and those who do will most likely see the rise in their Part B and Part D premiums slow.

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Medicare IRMAA costs could impact your 2020 Medicare premiums.

What Is the IRMAA for 2020?

IRMAA costs are divided up into different brackets based on your modified adjusted gross income (MAGI) from two years prior. The higher your reported 2018 income, the higher 2020 IRMAA you’ll pay. 

The chart below shows the IRMAA brackets for both individual and joint filers for 2020, based on their income from 2018. 

2020 Medicare IRMAA Brackets
2020 (based on 2018 individual tax return) 2020 (based on 2018 joint tax return)

$86,000 or less

$172,000 or less

More than $86,000 and up to $109,000

More than $172,000 and up to $218,000

More than $109,000 up to $136,000

More than $218,000 and up to $272,000

More than $136,000 up to $163,000

More than $272,000 and up to $326,000

More than $163,000 up to $500,000

More than $326,000 up to $750,000

More $500,000

More than $750,000

How Is the 2020 IRMAA Changing?

For the first time in a decade, the income levels that determine IRMAA costs will be indexed according to inflation, using the consumer price index (CPI) from September 2018 to August 2019.

  • Inflation rose 1.7% during that 12-month span

  • IRMAA income brackets will also increase 1.7% from 2019 to 2020

  • Income brackets are rounded to the nearest $1,000

IRMAA income brackets will generally increase from $1,000 to $3,000 for individual tax filers, and between $2,000 and $6,000 for married couples filing jointly. 

How Do New 2020 IRMAA Brackets Affect 2020 Part B and Part D Premiums?

Fewer people are expected to be subject to IRMAA surcharges for their 2020 Part B and Part D premiums.

  • For example, a Medicare beneficiary who reported a 2017 modified adjusted gross income of $85,500 was forced to pay an IRMAA for their Part B and Part D premiums in 2019. 

  • In 2020, a Medicare beneficiary filing a 2018 modified adjusted gross income of $85,000 would now not meet the threshold requiring them to pay a higher Part B and/or Part D premium.

Other beneficiaries might still have to pay the IRMAA surcharge, but they will likely now do so at a lower rate.

  • For example, a married couple with a 2017 modified adjusted gross income of $215,000 found themselves in the third income bracket of IRMAA requirements in 2019.

  • If the same couple reported the same income in 2018, that couple would now be in the second income bracket in 2020, and they would pay a lower IRMAA than they did in 2019.

What Is the Medicare Part B Premium for 2020?  

While it has yet to be officially announced, the standard premium for Medicare Part B is projected to be $144.30 per month in 2020.

This represents an $8.80 increase from the 2019 standard premium of $135.50 per month.

What Changes Are Coming to Medicare in 2020?

The changes to how IRMAA costs are decided isn’t the only thing that might look different for Medicare Part B and Part D beneficiaries in 2020.

Coverage limits for 2020 Part D plans will also see a change.

  • The maximum annual deductible will increase by $20, to $435 in 2020.

  • The initial coverage limit (the amount of money you will spend on covered prescription drugs before reaching the Part D “donut hole” coverage gap) increases from $3,820 in 2019 to $4,020 in 2020.

  • The amount of out-of-pocket drug spending needed to leave the donut hole coverage gap and enter the catastrophic coverage stage will increase from $5,100 in 2019 to $6,350 in 2020

Also, the Part D donut hole itself will shrink in 2020. Beneficiaries will now pay just 25% of the cost of generic drugs while in the donut hole, which is down from 37% in 2019. They will also pay 25% of the cost of brand name drugs while in the coverage gap.

Another change coming in 2020 is that newly-eligible beneficiaries (those who become eligible for Medicare on or after January 1, 2020) will not be able to have Medigap coverage of the Part B deductible.

  • This means that Medigap Plan F and Plan C will not be available to beneficiaries who become eligible for Medicare on or after January 1, 2020.

  • Beneficiaries who become eligible before this date may still apply for Plan F or Plan C, if either plan is available where they live.

  • Current Medigap Plan F and Plan C beneficiaries will be able to keep their plan.

Medicare Supplement (Medigap) Plans Can Help Cover Other Part B Costs

Medicare Supplement (Medigap) plans — other than Plan C and Plan F — don’t cover the Medicare Part B deductible, but they can help pay for other Part B and Part A costs, such as certain deductibles, coinsurance, copayments and more.

Call today to speak with a licensed insurance agent who can help you compare your Medigap plan options and find a plan that helps pay for your out-of-pocket Medicare costs.

 

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Christian Worstell is a health care and policy writer for MedicareSupplement.com. He has written hundreds of articles helping people better understand their Medicare coverage options.

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