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Dear Savvy Senior,
I know there will be a small 2.5 percent cost-of-living increase in Social Security benefits next year, but what about Medicare? What will the Medicare Part B monthly premiums be in 2025, and when do the surcharges kick in for higher income beneficiaries?
Medicare Beneficiary
Dear Beneficiary,
The Centers for Medicare and Medicaid Services recently announced their cost adjustments for 2025 and the increases for premiums and out-of-pocket costs for most beneficiaries will be moderate. But if you’re a high earner, you’ll pay significantly more. Here’s what you can expect to pay in 2025.
Part B Premium
While Medicare Part A, which pays for hospital care, is premium-free for most beneficiaries, Part B, which covers doctor visits and outpatient services does have a monthly premium.
Starting in January, the standard monthly Part B premium will be $185, up from $174.70 in 2024. That $10.30 bump represents a 5.9 percent increase, which is more than double the most recent Social Security cost-of-living adjustment which was 2.5 percent.
But if you’re a high earning beneficiary, which makes up about 8 percent of all Medicare recipients, you’ll have to pay more. Medicare surcharges for high earners, known as the income-related monthly adjustment amount (or IRMAA), are based on adjusted gross income (AGI) from two years earlier, which means that your 2025 Part B premiums are determined by your 2023 AGI, which is on line 11 of the IRS tax form 1040.
Here’s how it breaks down. If your 2023 income was above $106,000 up to $133,000 ($212,000 up to $266,000 for married couples filing jointly), your 2025 Part B monthly premium will be $259.
Monthly Part B premiums for singles with an income between $133,000 and $167,000 ($266,000 and $334,000 for joint filers) will rise to $370.
Individuals earning above $167,000 up to $200,000 ($334,000 to $400,000 for joint filers) will see their monthly Part B premium increase to $480.90.
Those with incomes above $200,000 up to $500,000 ($400,000 to $750,000 for joint filers), will pay $591.90 per month in 2025. And single filers with income of $500,000 or more ($750,000 or more for joint filers) will pay $628.90 per month.
Part D Premium
If you have a stand-alone Medicare (Part D) prescription drug plan, the average premium in 2025 will be $46.50 per month for most beneficiaries, down from $53.95 in 2024. But again, for high earners with annual incomes above $106,000 ($212,000 for joint filers) you’ll pay a monthly surcharge of $13.70 to $85.80 (based on your income level) on top of your regular Part D premiums.
How to Contest Income
Beneficiaries that fall into any of the high-income categories and have experienced certain life-changing events that have reduced their income since 2023, such as retirement, divorce or the death of a spouse, can contest the surcharge. For more information on how to do this, see “Medicare Premiums: Rules for Higher-Income Beneficiaries” at SSA.gov/benefits/medicare/medicare-premiums.html.
Other Medicare Increases
In addition to the Part B and Part D premium increases, there are other cost increases you should be aware of. For example, the annual deductible for Medicare Part B will be $257 in 2025, which is $17 more than the 2024 deductible of $240. And the deductible for Medicare Part A, which covers hospital services, will increase to $1,676 in 2025. That’s $44 more than the 2024 deductible of $1,632. There are no surcharges on Medicare deductibles for high earners.
For more information on all the Medicare costs for 2025 visit Medicare.gov/basics/costs or call 800-633-4227.
Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC Today show and author of “The Savvy Senior” book.