Medicare Part B Premiums to Increase
in 2007
(From: The U.S. Railroad Retirement Board)
December
2006
No. 06-7
For Immediate
Release
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 accompanying tables show the 2007 Part B
premiums based on income. 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
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Posted: 12/27/06