It' that time....Medicare.

[Baizuo Pride!]

Originally Posted by Bob Kontak

I do like not having to deal with co-pays,

This.

I'll reach Medicare age this year. If there's plan where I can pay each month to avoid co-pays and such, and it's somewhat reasonable, I'll pay for it.

[fintstone]

If you made a lot of money last year, be prepared to pay a crazy amount for Medicare (as the cost is based on the previous year's tax return). I was shocked at how much it cost.

[stevej37]

^^^conversely....does the cost go down if you lost money??

[stevej37]

Originally Posted by Baizuo Pride!

This.

I'll reach Medicare age this year. If there's plan where I can pay each month to avoid co-pays and such, and it's somewhat reasonable, I'll pay for it.

The co-pays are usually only $10 or less. If you want to pay more than that to avoid co-pays...go for it.

[fintstone]

Originally Posted by stevej37

^^^conversely....does the cost go down if you lost money??

The standard Part B premium amount in 2022 is $170.10 per person. Most people pay the standard Part B premium amount. If your modified adjusted gross income (MAGI) as reported on your IRS tax return from 2 years ago is above a certain amount, you'll pay the standard premium amount and an Income Related Monthly Adjustment Amount (IRMAA). IRMAA is an extra charge added to your premium. The total Part B Premium plus IRMAA can be as much as $578.30 per person depending on that MAGI of two years earlier (or 13,879.20 per year for a couple). MAGI includes investment income, retirement income, disbursements from 401K, etc.

If your gross income comes down, your premium then goes down the year following the tax return that shows that is the case (to as low as to $170.10 per person).

[flatbutt]

If you have any scripts you may be surprised to see that some aren't covered by medicare. My anti-inflammatory is covered but costs me $199 every refill.

[Joe Bob]

$199 per refill so yer butt don't hurt? Ouch....%^)

[stevej37]

^^^ I have none. But I'm not interested in seeing my Medicare cost go up.
My tax return (which I just completed) shows an increased AGI

[fintstone]

Originally Posted by stevej37

^^^ I have none. But I'm not interested in seeing my Medicare cost go up.
My tax return (which I just completed) shows an increased AGI

Here is the chart. Most people that are not still working pay the minimum. I always point this cost out because I screwed up by making a large 401K withdrawal one year and never thought about the impact on Medicare. The same would be true for selling a rental home or similar investment. It was bad enough paying 35% taxes on the money plus another almost 10% to the state...but Medicare was adding insult to injury. Especially since I was still working and we were already paying massively for health insurance.

[stevej37]

^^^ Thanks Fint...it looks like mine should stay the same.
(I'm in the lowest amount box)

[flatbutt]

IIRC it's a 2 year look back.

[fintstone]

Originally Posted by stevej37

^^^ Thanks Fint...it looks like mine should stay the same.
(I'm in the lowest amount box)

No problem. Yes, it seems like a real "first world problem" but it can be painful if unexpected for really high cost of living areas where couples are both still working...or after what is just an abnormally good year (when you cash out of something). It becomes a 10K+ "donation" on top of $100K+ of extra taxes (that you may not have really planned on).

[fintstone]

Originally Posted by flatbutt

IIRC it's a 2 year look back.

Yes. Essentially, since it uses your reported MAGI on you last return. You do taxes for the previous year the following spring and then at the end of that year, your Medicare is recomputed for the next one.