About 4.5 Million Medicare Beneficiaries Pay an Extra Premium Most People Have Never Heard Of. In 2027 the Threshold Rises.

About 4.5 million Medicare beneficiaries pay more for their Part B and Part D coverage than the standard premium - not because they are in a different plan, but because their income exceeds a specific threshold. The surcharge is called IRMAA, the Income-Related Monthly Adjustment Amount. Most people encountering it for the first time are surprised to find it applied to their income from two years earlier.

In 2026, the IRMAA surcharge begins for single filers once their Modified Adjusted Gross Income exceeds $109,000. For married couples filing jointly, the threshold is $218,000. In 2027, those thresholds are projected to rise to approximately $111,000 to $113,000 (single) and $222,000 to $226,000 (joint), based on current inflation projections. CMS will not confirm the final 2027 brackets until November 2026.

How the Two-Year Lookback Works

The income that triggers your 2027 IRMAA surcharge is not your 2027 income - it is your 2025 Modified Adjusted Gross Income from the tax return filed in April 2026. This means income decisions made in 2025, including Roth conversions, large capital gains, retirement account distributions, or business income, are what set your Medicare costs for 2027. By the time the bill arrives, the income that triggered it is already two years in the past.

The surcharge does not phase in gradually. It is a cliff: crossing a threshold by a single dollar moves your entire premium up to the next tier for the full year. A retiree whose 2025 MAGI was $110,000 rather than $109,000 would owe the first-tier IRMAA surcharge on both Part B and Part D for all of 2027.

What the Surcharge Actually Costs

At the first IRMAA tier - $109,000 for a single filer in 2026 - the surcharge adds approximately $95.70 per month to combined Part B and Part D costs above standard premiums. That is roughly $1,148 annually for one person, or more than $2,200 for a couple both on Medicare. The surcharge climbs across five tiers, reaching a point where high-income beneficiaries pay close to 80 percent more than the standard Part B premium. There is no improvement in coverage at any tier - the extra cost buys nothing except a higher bill.

What to Do Before November

If your 2025 income was unusually high due to a one-time event - a property sale, an inheritance, a retirement account distribution - and your normal income is below the threshold, IRS Form SSA-44 allows you to report a “life-changing event” that reduced income after the tax year used for the calculation. Filed correctly, it can reduce or eliminate the surcharge. November 2026 is when CMS announces the official 2027 brackets. That is the first moment the actual 2027 threshold is confirmed.

References: Projected 2027 IRMAA Brackets and Surcharges for Medicare Part B and D | IRMAA Income Thresholds 2027: Projected Brackets | 2027 IRMAA Brackets | What Is the Income-Related Monthly Adjusted Amount (IRMAA)?