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my wife got a letter from ss today pertaining to her 2016 medicare rates .
it just let her know that because she is collecting ss she is covered under the hold harmless law and her medicare premium will stay at 104.50 .
however if she had been delaying her 2016 premiums would have been almost 390 .00 . that is almost a 400% increase .
the reason is they go by 2014 taxes when we both were working and we had a large sale of some commercial lease rights back then which would have .had us reaching the highest level of premiums years later . if i was of age for medicare and delaying that would have been 390 x2 per month instead of 104.00 x 2 per month .
so just a heads up , you may be in the lowest tax bracket with little taxable income delaying ss when you retire but if you earned big dollars prior and delay taking ss you can be in for a whopper of a medicare payment even though retired , since they use the prior year actually FILED , in this case 2014 since 2015 is not filed yet . . .
Last edited by mathjak107; 12-10-2015 at 03:25 PM..
If you had a major life-changing event and your income has gone down, you may use
this form to request a reduction in your income-related monthly adjustment amount.
....
If you prefer to schedule an interview with your local Social Security office, call 1-800-772-1213
(TTY 1-800-325-0778).
We plan to fill out this form early next year when my husband applies for Medicare part B and D coverage. Our life changing even is work stoppage because I retired.
If we don't fill out the form, I expect a whopping premium based on our income in 2014 & 2015 especially since my severance payment was paid this year on top of my 2015 income.
Okay let's see if I get this. Your medicare rate stays the same every year after you start taking SS? And that rate is based on your income the year before you first file for SS? I thought your medicare payment would adjust every year based on the previous years income, even after you start SS. Is that wrong then?
no , your medicare rate can go up every year but if you are already collecting your increase can't be more than your cola increase .
since there was no cola increase if you were already collecting you got no medicare increase for 2016 . if you were delaying taking ss you are not covered under that law .
medicare is also income linked and they typically go by your last filed tax return .
but if you have a big income reduction from that year you can request with that form that they use 2015 instead of 2014 even though you have not filed 2015 yet .
So I am not collecting SS yet (68 waiting until 70). I sold a piece of property in 2013 which gave me a big bump in income. This involked something called irmma which drove my part b up to 336 this last year. From what you said this would not have happened if I was already getting SS.
Now going into the future. Is your suggestion that you keep your income low the year before you file for SS? I appreciate you bringing this up!
the general increase would not have gone up more than the cola adjustment that year if you were not delaying . in 2014 my wife was not on medicare but had she been on medicare we would have been increased because of income .
Yes, that is correct, if you were collecting your SS, your Medicare would have stayed the same. SO if you were delaying SS, and the gain per month was less than the increase of your Medicare Part B was, the delay then actually cost you instead of benefited you, in addition to the lost SS benefit itself. Delaying for a "higher" benefit is not always the right thing to do. Matt has posted about this before. If at all possible try to minimize the income in the tax year before you have to File for Part B. In my case, I want to stop working no later than 63, and just draw against my pension and IRA to control income to lower tax rate to both reduce RMDs and control what Medicare will be. I have excellent low cost medical coverage until I'm 65 through my retirement plan. If I work past that age, my income will be much higher in the year previous to having to file for Part B.
Yes, that is correct, if you were collecting your SS, your Medicare would have stayed the same. SO if you were delaying SS, and the gain per month was less than the increase of your Medicare Part B was, the delay then actually cost you instead of benefited you, in addition to the lost SS benefit itself. Delaying for a "higher" benefit is not always the right thing to do. Matt has posted about this before. If at all possible try to minimize the income in the tax year before you have to File for Part B. In my case, I want to stop working no later than 63, and just draw against my pension and IRA to control income to lower tax rate to both reduce RMDs and control what Medicare will be. I have excellent low cost medical coverage until I'm 65 through my retirement plan. If I work past that age, my income will be much higher in the year previous to having to file for Part B.
I am a Fed Gov employee and have FEHB BC/BS standard plan which I can and will continue into retirement. Although I don't plan to work to my FRA which is 66.5, but if I did I would be enrolling in Medicare Part B at age 65 while working another 1.5 years before collecting SS. So how would that impact my Medicare Part B premium ? If the look back for Medicare Part B premium calculation on income is a year, am I looking at 3 years of monthly premiums being in the $300+ range which would equal give or take $11,000 ? If this is the case, why would I even opt into B at that cost when I already have FEHB BC/BS standard which cost for single coverage is $304 a month with a $350 annual deductible that also includes dental and vision?
If you are covered by a qualified health plan, and you have healthy income, it would indeed be foolish to apply for Medicare Part B, and yes, your premiums would be high. Luckily, as the Medicare rules are written, you do NOT have to apply if covered. My wife will be 65 when I am 60 and still working and she will be covered under my employers plan. The extra premium for her is far less than the Part B would be. She does have to enroll in Part A, but as it is free, it just becomes a secondary.
If I retire at the planned 63 and she is 68, she will have to go on Medicare B, and I will have to pay a higher premium for her that year, as the way my retirement health benefit works, once you turn 65, you have to enroll in both. So for a year, we will pay more for just her. But they provide a nice stipend that applies to any Gap insurance I want, as well as my Part B, which lessens the blow.
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