Before You Enroll in Medicare, Read This So There Are No Surprises

Many people picture their Medicare premium as a flat, predictable cost once they retire. For a growing share of retirees, it’s not quite that simple. Medicare Part B premiums rose to $202.90 a month in 2026, an increase of nearly 10 percent from 2025. For higher earners, a surcharge called the Income-Related Monthly Adjustment Amount, or IRMAA, can add hundreds more on top of that.¹

IRMAA is not based on this year's income. It’s based on the tax return filed two years earlier, so a 2026 premium was set using a 2024 return.²

That two-year lag means you could pay a Medicare surcharge tied to a salary you no longer collect. The rule itself has been in place for almost two decades, but new retirees tend to see it for the first time as they enroll.²

Here’s the painful reality about how IRMAA works. Report one dollar over $109,000 in income as a single filer, and the surcharge applies to the entire premium for the full year, about $1,148 more.³

For a married couple where both spouses are enrolled in Medicare, the same tax return sets both premiums. A single extra dollar reported on that return adds roughly $2,297 a year to the household's combined bill.³

The two-year lookback assumes life stays fairly steady, and for many households approaching Medicare eligibility, that’s not the case. Retirees can experience a drop in income, and it often lands in the same window as Medicare enrollment.

Social Security has a process for this exact situation. Form SSA-44 lets a beneficiary ask for that year's IRMAA to be based on more recent income instead of the two-year-old return, but only following a qualifying life event. A few examples are retirement, divorce, and the loss of a pension.²

If you're approaching enrollment and want to understand where you stand, please reach out. We don't want you to be surprised when you enroll.

^{1. CMS.gov, November 14, 2025.}

^{2. SSA.gov, 2026.}

^{3. Medicare.gov, 2026.}