Income threshold to means test for Medicare
Client heard on Wealth track with Consuela Mack that the government will use the 2016 income as the year that would be the benchmark for income for future medicare payments.
Can anyone confirm that this is true?
Thank you.
Nick
Permalink Submitted by Alan - IRA critic on Fri, 2015-09-11 16:49
Most likely they are referring to the recent change in the law (to help pay for the Doc fix) in which two of the IRMAA premium surcharge tiers will have surcharge rate increases starting in 2018. The portion of the present tiers which will have the increase are tiers 3 and 4 of the current 5 tier structure. Since IRMAA surcharges are based on the MAGI from the tax return of the second prior year, the 2016 MAGI will be used to determine which tier a Medicare beneficiary will be in for 2018. See this article: http://kff.org/medicare/issue-brief/medicares-income-related-premiums-a-data-note/
Permalink Submitted by [email protected] on Fri, 2015-09-11 17:54
more recent article suggests people will see hikes as early as next year – http://www.investmentnews.com/article/20150831/BLOG05/150839996/worst-case-scenario-for-medicare-premium-hike-in-2016where do we get clarity on the timing of these new premiums?
Permalink Submitted by Alan - IRA critic on Fri, 2015-09-11 18:29
Yes, that is an additional situation brought on by the combination of no COLA for 2016 and the docfix that triggered a basic Part B increase that can only be absorbed by the 30% of beneficiaries NOT benefiting from the hold harmless provision. However, the IRMAA MAGI calculation for 2016 premiums is based on the 2014 return. Whenever MAGI is used to determine the applicable IRMAA tier, the return two years prior determines the MAGI.