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  • msf September 2019
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Medicare IRMAA Surcharges To Be Adjusted For Inflation In 2020

FYI: For the first time in a decade, the income brackets used to determine Medicare premium surcharges for high-income retirees will be indexed to inflation starting Jan. 1. As a result, some retirees may experience a reduction in their Medicare surcharge costs next year.

Beginning Jan. 1, the income related monthly adjustment amount brackets used to determine high-income surcharges for individuals and married couples will be indexed to the consumer price index based on the 12-month CPI change from September 2018 through August 2019.
Regards,
Ted
https://www.google.com/search?sxsrf=ACYBGNRBfhvsbmcppIAyWh26LZaFPqrinw:1568708735956&source=hp&ei=f5iAXeLuNs-isAXJjaOoCQ&q=Retirement+Strategies+Medicare+IRMAA+surcharges+to+be+adjusted+for+inflation+in+2020+&oq=Retirement+Strategies+Medicare+IRMAA+surcharges+to+be+adjusted+for+inflation+in+2020+&gs_l=psy-ab.3...3207.3207..4485...0.0..0.71.71.1......0....2j1..gws-wiz.gHz9QbS1CaY&ved=0ahUKEwiiqta3t9fkAhVPEawKHcnGCJUQ4dUDCAc&uact=5

Comments

  • Just remember that these figures are all estimates, and don't rely on them too much.

    The article states (correctly) that "As a result [of CPI-U going up by 1.7%], the income brackets used to determine Medicare surcharges in 2020 will increase by 1.7%, rounded to the nearest $1,000."

    So what does that mean for the $170K start of IRMAA for couples? 1.7% of that is $2.89K, or $3K rounded to the nearest $1K. It seems that for 2020 the IRMAA start figure should now be $173K. But the article says $172K.

    Then there's the Finance Buff, which came up with $174K.
    https://thefinancebuff.com/medicare-irmaa-income-brackets.html

    Here's the whitepaper cited in the Investment News piece:
    http://www.hvsfinancial.com/wp-content/uploads/2019/09/2019-HVS-Medicare-surcharges.pdf

    That's got its own problems. My guess is that what it did was take the IRMAA start vale for singles, $85K, compute the new value for 2020 of $86K, and double it for couples. If I read calculation rules correctly, one should compute the current value for couples by doubling that of singles (this is where the $170K comes from), then add 1.7% and round.

    Statute on how IRMAA is set: https://www.ssa.gov/OP_Home/ssact/title18/1839.htm#act-1839-i-1

    While I'm inclined to prefer my own numbers, I would still wait for the official numbers to come out.
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