How much does Medicare Part D cost?
Get your premium automatically deducted
Contact your drug plan (not Social Security) if you want your premium deducted from your monthly Social Security payment. Your first deduction will usually take 3 months to start, and 3 months of premiums will likely be deducted at once.
After that, only one premium will be deducted each month. You may also see a delay in premiums being withheld if you switch plans. If you want to stop premium deductions and get billed directly, contact your drug plan.
Part D costs more for higher income individuals
If your modified adjusted gross income as reported on your IRS tax return from 2 years ago (the most recent tax return information provided to Social Security by the IRS) is above a certain limit, you may pay a Part D income-related monthly adjustment amount (Part D-IRMAA) in addition to your monthly plan premium. This extra amount is paid directly to Medicare, not to your plan.
Let Waugh Agency help you find the best Part D plan for your needs
Social Security will contact you if you have to pay Part D-IRMAA, based on your income. The amount you pay can change each year. If you have to pay a higher amount for your Part D premium and you disagree (for example, if your income goes down), use this form to contact Social Security.
The extra amount you have to pay isn’t part of your plan premium. You don’t pay the extra amount to your plan. Most people have the extra amount taken from their Social Security check. If the amount isn’t taken from your check, you’ll get a bill from Medicare or the Railroad Retirement Board. You must pay this amount to keep your Part D coverage.
If Social Security notifies you about paying a higher amount for your Part D coverage, you’re required by law to pay the Part D-Income Related Monthly Adjustment Amount (Part D-IRMAA). If you don’t pay the Part D-IRMAA, you’ll lose your Part D coverage.
Part D premiums by income
The charts below show your estimated prescription drug plan monthly premium based on your income as reported on your IRS tax return from 2 years ago. If your income is above a certain limit, you’ll pay an income-related monthly adjustment amount in addition to your plan premium.
| If your yearly income in 2011 was | You pay (in 2013) | ||
|---|---|---|---|
| File individual tax return | File joint tax return | File married & separate tax return | |
| $85,000 or less | $170,000 or less | $85,000 or less | your plan premium |
| above $85,000 up to $107,000 | above $170,000 up to $214,000 | not applicable | $11.60 + your plan premium |
| above $107,000 up to $160,000 | above $214,000 up to $320,000 | not applicable | $29.90 + your plan premium |
| above $160,000 up to $214,000 | above $320,000 up to $428,000 | above $85,000 up to $129,000 | $48.30 + your plan premium |
| above $214,000 | above $428,000 | above $129,000 | $66.60 + your plan premium |
| If your yearly income in 2012 was | You pay (in 2014) | ||
|---|---|---|---|
| File individual tax return | File joint tax return | File married & separate tax return | |
| $85,000 or less | $170,000 or less | $85,000 or less | Your plan premium |
| above $85,000 up to $107,000 | above $170,000 up to $214,000 | not applicable | $12.10 + your plan premium |
| above $107,000 up to $160,000 | above $214,000 up to $320,000 | not applicable | $31.10 + your plan premium |
| above $160,000 up to $214,000 | above $320,000 up to $428,000 | above $85,000 up to $129,000 | $50.20 + your plan premium |
| above $214,000 | above $428,000 | above $129,000 | $69.30 + your plan premium |
What’s the Part D late enrollment penalty?
How much is the Part D penalty?
The cost of the late enrollment penalty depends on how long you went without creditable prescription drug coverage.
The late enrollment penalty is calculated by multiplying 1% of the “national base beneficiary premium” ($32.42 in 2014; $31.17 in 2013) times the number of full, uncovered months you were eligible but didn’t join a Medicare Prescription Drug Plan and went without other creditable prescription drug coverage. The final amount is rounded to the nearest $.10 and added to your monthly premium.
The national base beneficiary premium may change each year, so the penalty amount may also change each year.
Your plan will tell you if you owe a penalty
After you join a Medicare drug plan, the plan will tell you if you owe a penalty, and what your premium will be. You may have to pay this penalty for as long as you have a Medicare drug plan. If you had to pay a Part D late enrollment penalty before you turned 65, the penalty will be waived once you reach 65.