Why Your Medicare Premium Increased in Texas (IRMAA Explained 2026 | Austin Area)

If your Medicare premiums suddenly increased in Texas—especially in the Austin, Round Rock, or Taylor area—you may be dealing with IRMAA (Income-Related Monthly Adjustment Amount)—and you’re not alone.

In this video, Premier Medicare Solutions breaks down:

What IRMAA is and why it increases your Medicare costs
Why your income from 2 years ago impacts what you pay today
Common triggers like Roth conversions, home sales, and retirement income
How to appeal using Form SSA-44
Smart planning strategies to avoid overpaying

Many Medicare beneficiaries across Texas—especially in the Austin metro area—are caught off guard by IRMAA each year. The good news? With proper planning, you may be able to reduce or even eliminate these extra costs.

If you're approaching Medicare, already enrolled, or recently retired in Texas, this is essential information to help protect your retirement income.

🌐 Learn more: https://www.premiermedicaresolutions.com/

📍 Need help with your Medicare plan or IRMAA strategy? Connect with a licensed local advisor serving Round Rock, Taylor, Austin, and surrounding Texas communities.

0:00 Intro – Why Medicare costs surprise people
0:20 What is IRMAA?
1:00 How IRMAA affects Medicare Part B & D
2:00 Why higher earners pay more
3:00 The 2-year income rule explained
4:10 Why retirees get blindsided
5:00 What counts toward MAGI (big mistakes)
6:00 Why IRMAA catches people off guard
7:20 Who should be paying attention
8:00 How to appeal IRMAA (SSA-44)
9:00 Qualifying life-changing events
10:30 Appeal success tips
11:30 How to plan ahead and avoid IRMAA
13:00 Annual enrollment & strategy tips
14:10 Final recap + what to do next



#TexasMedicare #AustinMedicare #RoundRockTX #TaylorTX #MedicareHelpTexas #AustinTX #TexasRetirement

Transcript

SPEAKER_00 0:10

Hey, welcome back. I'm Mackenzie with Hermier Medicare Solutions, and today we're talking about something that catches people off guard every single year. And honestly, it doesn't have to. It's called Irma. And if you've never heard of that word before, you're not alone. Most people haven't until they get a letter in the mail telling them that they owe more for Medicare than they expected. And by then, the income that triggered it, well, it's already two years in the past. So today we're going to break down this completely what Irma is, how it works, why the timing creates such a problem, and most importantly, what you can actually do about it. Whether you're already on Medicare, about to turn 65, or just starting to think about retirement, this episode is for you. So let's get into it. So what is Irma? Irma stands for income-related monthly adjustment amount. It's a surcharge, an additional monthly cost added on top of your standard Medicare Part B and Part D premiums if your income exceeds certain thresholds. Now, most people know Medicare isn't free. You pay a monthly premium for Part B, which covers your doctor's visits, outpatient care, preventive services, and medical equipment. And if you have a Part D prescription plan, you'll pay a premium for that too. Those are your baseline costs. What a lot of people don't know is that some beneficiaries, those with higher incomes, pay significantly more than everyone else. Not a little more, potentially a lot more. The extra amount is Irma. Here's the thing that makes it especially impactful. It's structured in tiers. The more your income exceeds the threshold, the higher the surcharge. And those tiers stack on top of your standard premium month after month for as long as your income stays above that line. It applies to both Part B and D. So if your income is high enough, you're getting hit from both directions, higher medical coverage costs and higher drug coverage costs at the same time. Now, I do want to be clear about something important. Irma is not a penalty, it is not a punishment for making good financial decisions. It's a tiered pricing structure that Medicare uses to ask higher income beneficiaries to contribute a larger share of the program costs. That's how it's designed. Whether you agree with that approach or not, the reality is the same. It affects your budget and you need to know that it's coming. The other thing I do want you to understand is how broad this can get. When you add up the surcharges across both Part B and D, a beneficiary at higher income levels could be paying hundreds of dollars more every single month than someone on the exact same Medicare plan whose income falls below the threshold. And that's real money. And it's money most people aren't planning for. Medicare uses your modified adjusted gross income. We call it MAGI. Medicare uses your modified adjusted gross income from your federal tax return, but not your most recent return. Your return from two years prior. So your Medicare premiums this year are based on your income from two years back. The Social Security Administration pulls that data from the IRS and uses it to calculate whether a surcharge applies to you and how much. Why two years? Because by the time Medicare needs to set premiums for the coming year, the most recently finalized and processed tax return is typically about two years old. Your most recent return hasn't been fully processed, so that's what they use and that's they use what's available. Now let's think about why that's such a problem for a lot of retirees. Picture someone who retires after a strong career. Their actual income? A fraction of what it was. Maybe just Social Security in some modest distributions, but Medicare doesn't know that yet. It's looking backward. And that gap between who you were financially two years ago and who you are today is where Irma blindsides most people. There's also a quirk in how your modified adjusted gross income is calculated for Irma purposes that trips a lot of people up. Your Magi starts with your adjusted gross income, but it also adds back tax-exempt interest, things like interest from municipal bonds. A lot of retirees hold municipal bonds specifically because the interest is federally tax-free. They assume it's invisible for Medicare purposes too, but it's not. That interest counts toward your Magi for Irma, even though you don't pay income tax on it. Other things that can unexpectedly push your Magi higher, required min required minimum distributions from a traditional IRA or 401k, the sale of a home or business, large capital gains, or a Roth conversion, any of these can spike your income in a given year. And two years later, you feel it in your Medicare premium. And because IRMA uses a CLIF system and not just a gradual slope, even a small amount of income over a threshold can trigger a significant jump in what you owe. You don't ease into a higher tier, you land in it all at once. Finally, when Social Security determines that Irma applies to you, they send you an initial IRMA determination notice. This comes from Social Security, not Medicare. It tells you what your adjusted premium will be and explains your appeal rights. So according to Medicare.gov, you may receive this at any time of the year. When you get it, keep it because you'll need it. So does this catch people by surprise? And the honest answer is yes, constantly. I've sat across from clients who are sharp, financially savvy people, people who plan their retirement carefully, who have financial advisors, who did everything they were supposed to do, and they're still stunned when an IRMA notice shows up. Part of it is the timing problem I just described. You're being judged on a financial picture that may no longer reflect your life at all. The year you sold your business, the year you took a large IRA distribute uh distribution, the year you had unusually high capital gains, those things aren't happening now, but Medicare doesn't know that. They're in your tax return, and that's what counts. Part of it is the cliff structure. With income tax, people have a general sense that higher income means gradually higher taxes. There's some intuition there. But with Irma, you can just be just under a threshold and pay nothing extra, then you can be just over it and owe a meaningful amount more every single month for the entire year. There's no intuition built up for that kind of system. And part of it, some and part of it is simply that Irma isn't front and center in most Medicare education. When people are turning 65 and doing their research and working with an agent, the focus is usually on choosing a plan, which makes sense. That's important. But with the cost of um, but the cost implications of income don't always come up until they have to. That's part of why I wanted to do this episode. A financial surprise in retirement isn't just annoying, it can be genuinely destabilizing when you're on a fixed income. When you open a letter that tells you your Medicare costs are going up significantly and you had no idea, that has a real impact on how you plan the rest of the year. And here's it, so here's a quick mental checklist. You might want to pay closer attention to Irma if any of these things apply to you. You're turning 65 in the next couple of years and had higher income during your final working years. You've recently sold a home, business, or a major asset, you're taking required minimum distributions and they've grown over time, you've done or are considering a large Roth conversion, your income fluctuates year to year, and you're not sure where you land. If any of those apply, please keep listening. So, what if your income has gone down? This is the appeal process. And this is the genuinely good news in all of this. If your income has dropped since the year Medicare is using to calculate your IRMA, you have the right to appeal. Medicare.gov is clear about this. If you receive an IRMA determination notice and your circumstances have changed, then you can appeal. And you have 60 days from the date that you receive that notice to start the process. The first step is to contact the Social Security since they're the ones who make the IRMA determination. You can call them directly, the number is on the notice that you get, and you can also visit them at a local office in person. The specific form used for appeals is called Form SSA 44, officially the Medicare Income Related Monthly Adjusted Amount Life Changing Event form. This is how you ask Social Security to use more recent income information instead of the two-year-old data that triggered the surcharge. The key word there is life-changing event. Appeals aren't just open to anyone who wants to pay less. They're tied to specific qualifying conditions. The ones recognized by Social Security are retirement or significant reduction in work hours. This is the most common one for people newly on Medicare. Death of a spouse, marriage or divorce, loss of income-producing property. So, for example, a rental property destroyed, foreclosed, or otherwise lost, loss of pension income, and then receipt of a settlement payment from an employer in a year prior to that inflated income. When you file SSA 44, you're providing documentation that supports both the qualifying event and your current or more recent income level. That might mean a retirement letter from your employer, updated financial statements, benefit award letters, or a more recent tax return. The specifics depend on your situation, but the principle is the same. You're showing Social Security that the income picture has changed materially. You can also appeal if you believe the determination was simply wrong. Maybe Social Security used incorrect data or missed an amended return you filed. In that case, you'd request a new initial determination with the corrected information. The appeals process has two tiers. The first step is an informal appeal with Social Security. Some people choose to work with an attorney or benefit specialist, but most successful appeals happen at the first tier. I want to say this directly. If you've retired recently and your income genuinely dropped, the approval rate for legitimate life-changing event appeals is high. This process exists specifically for your situation. A lot of people assume it's not worth trying or that the government will just say no. The assumption costs them real money. File the appeal. And one more thing on timing. That 60-day window starts from when you receive the notice. And so and Social Security assumes you receive it about five days after the date on the letter. So don't sit on it. If you get a notice and think your income situation qualifies, start gathering your documentation immediately. So let's talk about the proactive side of this because knowledge is only useful if you do something with it, right? So the most important the most important mindset shift I want you to walk away with this is income decisions you made make today have Medicare consequences two years from now. Once you're on Medicare, the two-year look back means your future premiums are being shaped by choices you're making right now. That changes how you think about financial decisions in retirement. So tip one, um, know where you stand relative to the thresholds before you make major financial moves. Before you do a larh large uh Roth conversion, sell a property, take a significant IRA distribution, or realize substantial capital gains, run the numbers. Understand that understand that what you will do to your magi and whether it puts you um over an IRMA threshold. Sometimes the move is still the right one, but it should still be a conscious decision, not just a surprise for two years later. Tip number two, understand what counts towards your magi. Your magi for IRMA purposes is not just your taxable income. It includes tax exempt interest, it includes certain items that reduce your regular income tax, but still factor into this calculation. Make sure you and any financial or tax professional you work with are using the right number and not just your AGI off the front of your return. Tip three. If you had an unusual income year, plan to appeal. If you know that two years ago you had a one-time spike in income, a business sale, a large distribution, a severance package, and you're approaching Medicare, get ahead of it. Gather your documentation before you even receive the notice. Know that form SSA 44 exists and that you have a legitimate path forward. Uh tip number four, review your coverage annually. The annual enrollment period runs from October 15th through December 7th of every year. Even if you're happy with your current plan, it is worth reviewing it through the lens of your income picture. If you're a Magi from this year will determine your IRMA two years out. And if something significant happens financially, factor that into your planning now, not just later. Tip five, work with a licensed Medicare advisor who looks at your full picture. I say this not just because it's what I do, I say it because uh the intersection of Medicare costs, income planning, and tax strategy is genuinely complex. There are things that you can do in the years before Medicare and in early retirement that meaningfully reduce your IRMA exposure over time. But they require someone who understands both how Medicare works and how income flows in retirement. So, and finally, nowhere to go for official um information. Everything I've talked about is verifiable at Medicare.gov. You can also call 1-800-Medicare, which is uh 1-800-633-4227, available 24-7. Um, if you have questions about specifically about your IRMA determination or when to start an appeal, that starts with the Social Security Administration. These are free resources, so use them and also reach out to me. All right, so let's bring it all home. IRMA is a Medicare surcharge for higher income beneficiaries. It affects both of your Part B and your Part D premiums. Medicare determines who determines who pays it using your income from two years ago, which is why it catches so many people off guard, especially newly retired folks whose income has already dropped significantly. The Cliff style bracket system means small differences in income can have outsized effects. And because Magi includes things like tax-exempt interest that people often don't account for, the number that triggers the surcharge is something sometimes higher than people expect. But you're not powerless. If your income has dropped due to a qualifying life-changing event, retirement, loss of a spouse, reduced work hours, you can appeal. You can use SSA 44, you contact Social Security, and you have 60 days from your notice. For legitimate situations, this process works. And going forward, understand the two-year look back. Know what counts towards your magi, plan your major financial decisions with Irma in mind, and work with somebody who can help you see around the corners. This is the kind of thing that nobody warns you about when you're 65, but now you know. Uh, I'm McKenzie with Premier Medicare Solutions. If this episode was helpful, please share it with somebody who's approaching Medicare or who's already enrolled and wondering if they're paying more than they should. It could make a real difference. Thanks for listening to another episode of the Medicare Matters podcast with McKenzie. Please make sure to subscribe wherever you get your podcast so you don't miss an episode. Please also leave a review as that helps me reach more people that can benefit from this podcast content. If you have questions or topics that you want me to cover for a future episode, please email them to McKenzie at Premier Medicare Solutions.com.