Frequently Asked Questions
What are the Medicare Part B Premiums for 2007?
The standard Medicare Part B monthly premium will be $93.50 in January 2007, an increase of $5.00 from the 2006 premium of $88.50.
All beneficiaries currently pay the same basic premium amount for Medicare Part B, which is set annually at a level that covers 25 percent of the estimated Part B program costs for the year. The Government has subsidized the remaining 75 percent for all beneficiaries. This 75-percent subsidy will decrease for those making over $80,000 a year beginning in 2007.
As a result of a new Medicare law, the Part B monthly premiums for some beneficiaries will be greater beginning in 2007, depending on a beneficiary’s or married couple’s modified adjusted gross income. The income-related Part B premiums for 2007 will be $105.80, $124.40, $142.90, or $161.40, depending on the extent to which an individual beneficiary’s income exceeds $80,000 (or a married couple’s income exceeds $160,000), with the highest premium rates only paid by beneficiaries whose incomes are over $200,000 (or $400,000 for a married couple). The income thresholds will increase annually by indexing to the consumer price index (CPI). The Centers for Medicare & Medicaid Services estimates that about 4 percent of Medicare beneficiaries with Part B will pay higher Part B premiums based on their incomes.
The Social Security Administration (SSA) is responsible for all income-related monthly adjustment amount determinations. To make the determinations, SSA will use the most recent tax return information provided by the IRS. For 2007, in most cases that will be the beneficiary’s 2005 tax return information. If that information is not available, SSA will use information from the 2004 tax return.
Those railroad retirement and social security Medicare beneficiaries affected by the new 2007 Part B income-related premiums will receive a notice from SSA by December 2006. The notice will include an explanation of the circumstances where a beneficiary may request a new determination. Persons who have any questions or would like to request a new determination should contact SSA after receiving and reviewing their notice.
The provision for an income-related Part B premium was part of the Medicare Prescription Drug, Improvement and Modernization Act of 2003.
2007 PART B PREMIUMS
| Beneficiaries who file an individual tax return with income: | Beneficiaries who file a joint tax return with income: | Income-related monthly adjustment amount: | Total monthly Part B premium amount: |
|---|---|---|---|
| Less than or equal to $80,000 | Less than or equal to $160,000 | $0.00 | $93.50 |
| Greater than $80,000 and less than or equal to $100,000 | Greater than $160,000 and less than or equal to $200,000 | $12.30 | $105.80 |
| Greater than $100,000 and less than or equal to $150,000 | Greater than $200,000 and less than or equal to $300,000 | $30.90 | $124.40 |
| Greater than $150,000 and less than or equal to $200,000 | Greater than $300,000 and less than or equal to $400,000 | $49.40 | $142.90 |
| Greater than $200,000 | Greater than $400,000 | $67.90 | $161.40 |
The monthly premium rates paid by beneficiaries who are married, but file a separate return from their spouses and who lived with their spouses at some time during the taxable year, are different. Those rates are as follows:
| Beneficiaries who are married, but file a separate tax return with income: |
Income-related monthly adjustment amount: | Total monthly Part B premium amount: |
|---|---|---|
| Less than or equal to $80,000 | $0.00 | $93.50 |
| Greater than $80,000 and less than or equal to $120,000 | $49.40 | $142.90 |
| Greater than $120,000 | $67.90 | $161.40 |
Note: Income-related premiums are being phased in over a 3-year period. This means that the income-related monthly adjustment amounts shown in the above tables represent 1/3 of the total income-related monthly adjustment amount that higher income beneficiaries will eventually pay in 2009. In 2008, high income beneficiaries will pay 2/3 of the total income-related monthly adjustment amount. The income threshold amounts will increase annually through indexing.
2007 Medicare Deductibles and Copays