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What To Do If Your Premium Is Not What You Expected

Question: What should I do now that I got a bill from CMS and the premium is not what I expected?

Answer: Social Security and Medicare have been around a long time. For most people, the Medicare Part B premium comes out of their Social Security check automatically to pay it. When people collect Social Security benefits, Medicare begins automatically and they get their card in the mail. If they decide to keep Medicare part B during this initial auto enrollment, the $144.60 monthly premium comes out of their Social Security benefit.

In your situation, you do not collect Social Security yet. More and more people make the Medicare enrollment decision before they begin to collect Social Security benefits. The Medicare enrollment decision happens when you turn 65, but Social Security can happen as early as 62. For people born after 1937, full retirement age is after their 65th birthday. Many people have opted to not collect Social Security earlier than their full retirement age, but still need to make a Medicare enrollment decision.

For people who do not collect Social Security benefits, they must actively enroll in Medicare Part A and B, if they need it, and receive a quarterly bill for premiums. That is the bill you just received. If you take the monthly $144.60 and multiply it by three months the total is $433.80. Sometimes the bill that is received is even higher than that. This can be for two reasons: the first is determined by when your birthday month falls. You are billed you for four months not three ($144.60 X 4= $578.40). This would only happen one time to get you on the normally quarterly bill schedule.

The second reason could be that your income is high, according to the Internal Revenue Service. In this situation, your monthly Medicare part B premium could be between $202.40 and $491.60. This higher Medicare Part B is call an Income Related Monthly Adjustment Amount, IRMAA, and is based on your income on your tax returns from two years ago. The 2020 IRMAA is based on your 2018 tax returns.

If you feel your income is no longer that high, you can request an adjustment of your IRMAA based on more recent tax returns or a life changing event which include retirement, death of a spouse, remarriage, and many others.

You must pay The Medicare Part B premium bill to keep it active, and use it to set up an automatic payment. You can also use a MyMedicare.gov account to pay the bill by credit card or debit card. Also, you can continue to send a check each quarter.

You should receive the bill quarterly on or about the 10th of the month. The payment is due by the 25th. This is not a bill I would recommend paying late. The amount seems high and it is, but it is for three months, so you won’t pay that amount again for a few months.

This bill from Medicare is called the CMS-500. You can find information on the medicare.gov website about this bill and other helpful information.

Once you have decided to collect Social Security benefits, your Part B premium will begin to be deducted automatically from your monthly benefit amount, and you will no longer receive a bill. The premium will subtracted from your Social Security benefit before it is deposited into your account.

Senior Life Matters is a community based program sponsored by Lutheran Jamestown. For questions and concerns or to reach Janell Sluga, GCMC, call us at 720-9797 or e-mail at SLM@lutheran-jamestown.org

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