7 Factors That Could Reduce Your Medicare Premiums

Part B, Part D, Medicare Advantage affected

Depending on your annual income, the amount you’ll have to pay above the standard Part B premium in 2026 could range from $81.20 to $487 a month. The high-income charge also applies to Part D prescription coverage from an insurer, employer or union, and those extra charges could range from $14.50 to $91 a month, also based on your 2024 income. 

Part D plan premiums vary widely, depending on what plan you pick and where you live. These surcharges apply whether you are enrolled in original Medicare or a Medicare Advantage plan.

And if you’re in a Medicare Advantage plan that includes Part D coverage, you’ll still have to pay the high-income charges to the federal government for both Part B, which many people have deducted from their Social Security checks, and Part D.

If the SSA determines you will have to pay a higher premium, the agency will send you a letter telling you:

• How the surcharge was calculated
• What to do if you believe the information used to calculate the premium adjustment is incorrect
• What to do if your income has been reduced or you’ve had what the government calls a “life-changing event”

To discuss your case, you can visit a Social Security office or call the SSA toll-free number, 800-772-1213. To request that your payment adjustment be reconsidered, you’ll need to file a Medicare IRMAA Life-Changing Event form, Form SSA-44.  

Here are the seven life-changing events that can exempt you from the premium surcharges:

1. A spouse’s death significantly reduces your income

The Social Security Administration will need proof of your spouse’s death and an estimate of your new income.

2. Marriage since the tax return in the calculation

SSA will need proof that you got married and an estimate of your joint income. 

You may have had to pay a surcharge based on your individual income. But if you wed and your joint income doesn’t exceed the high-income threshold for joint filers, you may no longer face a higher premium. 

3. Divorce or annulment because it also can affect income

The SSA will need proof of your change in marital status, as well as an estimate of your reduced income.

4. Work reduction, as in moving to a part-time job

Partial retirement or changing from full-time to part-time employment are some examples. Documentation can include an employer statement, pay stubs showing a change in hours, corporate minutes, record of a business transfer or your statement that your hours have been reduced.

5. Work stoppage, including retirement or a layoff

Your layoff, retirement or the sale of your business or corporation are qualifiers. The SSA says proof of such changes include an employer statement, a retirement letter, corporate minutes, record of a business transfer or sale or a statement from you regarding your work stoppage.

6. Loss of income from property that’s beyond your control

The reasons include arson, natural disaster or theft. Income-producing property can include crops, livestock, real estate such as rental homes or farmland, and vehicles used for business.

7. Loss or reduction of certain kinds of pension income

The SSA has very specific requirements for this one: The pension must be a traditional defined benefit pension or a cash balance plan where fluctuations in a plan’s investments don’t affect the benefit amount promised to participants. 

And the loss of income must result from a plan failure or termination or because the pension stopped based on a decision you made in the past. One example: If you took a 20-year annuity rather than a lifetime pension when you retired 20 years ago and that has paid out. 

The SSA will generally require a letter from the pension plan administrator and possibly a copy of the plan description.

Other ways to contest the surcharge

Wrong info. You can try to make the case that Social Security used outdated or incorrect information when calculating your surcharge. Maybe you filed an amended tax return for the year the SSA is using to make an IRMAA decision, or the IRS supplied the agency with an older tax return and you want to use a more recent one that will show you received a lower income than previously reported.

Appeals process. If your exemption request is rejected, you can ask the SSA to reconsider.

If you disagree with the reconsideration decision, the next step within 60 days is to ask for a hearing. Hearings are held before an administrative law judge in the U.S. Department of Health and Human Services’ Office of Medicare Hearings and Appeals.

You’ll have 10 days to submit any new evidence but can request an extension. Although not required, the Medicare Rights Center recommends contacting a lawyer or legal services organization for help at this point because the appeals process can get complicated.

If you disagree with the Office of Medicare Hearings and Appeals decision, you can continue the appeals process to the Medicare Appeals Council. Ultimately, you can file a civil suit in your local federal district court.

Your eligibility can change each year

Because these income surcharges are calculated every year, your status can vary if your income increases or decreases. 

You could pay the surcharge for just one year if your income temporarily bumps you into high-end territory. That could include having capital gains from stock sales, doing a Roth IRA conversion or getting a profit from a property sale — none of which qualify as IRMAA exceptions.