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Higher Medicare Part B premiums in 2012

by on
in Small Business Tax,Small Business Tax Deduction Strategies

The cost of everything else seems to be going up ... why not Medicare Part B premiums? The government recently announced a modest increase in the monthly premiums for 2012. But it amounts to a reduction for senior citi­zens who enrolled in Part B in 2010 and 2011.

Medicare Part B covers physician services, qualified outpatient hospital care, medical equipment and certain other services.

Alert: The basic monthly Medicare B premium in 2012 is $99.90 (up from $96.40 per month in 2011). Those who enrolled in 2010 paid monthly premiums of $110.50; $115.40 per month for 2011 enrollees.

However, certain other individuals must pay a higher Medicare Part B premium, based on their modified adjusted gross income (MAGI). Also, high-income senior citizens owe a surcharge on Part D premiums for coverage of prescription drugs.

The rates for single and joint filers in 2012 are shown in the chart below.

The Social Security Administration (SSA) uses tax figures from two years ago to determine the Part B premiums. So the MAGI reported on a taxpayer’s 2010 tax return determines if the taxpayer must pay a higher monthly Part B premium in 2012. For example, a single filer with a MAGI of $150,000 in 2010 will have to pay a monthly Medicare Part B premium of $199.80 in 2012.

Note that the 2010 health care legislation suspends indexing of the income brackets for Medicare Part B premiums until 2020.

Tip: Other special rules apply to married couples who file separate returns.  For more information, visit the SSA website at www.ssa.gov.

 

MAGI for single filers

MAGI for joint filers

Monthly Part B premium

Monthly Part D surcharge

$85,001-$107,000

$170,001-$214,000

$139.90

$11.60

$107,001-$160,000

$214,001-$320,000

$199.80

$29.00

$160,001-$214,000

$320,001-$428,000

$259.70

$48.10

Above $214,000

Above $428,000

$319.70

$66.40

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