How to Avoid the Medicare High-Income Surcharge

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I had to pay the Medicare Part B and Part D high-income surcharge because of my income while I was working. But I retired this year, and my income dropped. Do I have to keep paying the surcharge?

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No. The government uses 2011 income to determine who is subject to the surcharge in 2013 because that is the latest tax return it has on file. If your income has dropped since 2011 because of certain life-changing events, such as retirement, divorce or the death of a spouse, you can get the surcharge reduced or removed. See Medicare Premiums: Rules for Higher-Income Beneficiaries for a list of eligible events and for more information about how to contest the surcharge. You'll need to contact the Social Security Administration and provide evidence of the life-changing event, such as a statement from your employer verifying that you've retired.


Single filers whose adjusted gross income (plus tax-exempt interest income) was greater than $85,000 and married couples filing jointly whose income topped $170,000 are subject to the high-income surcharge. Depending on income, their Part B premiums will be from $146.90 to $335.90 per month (up from the standard $104.90 per month), and their Part D premiums will go up by $11.60 to $66.40 per month. See Medicare Part B Premiums to Rise in 2013 for a list of who pays what next year.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.




This article appears in: Personal Finance , Insurance

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