Medicare is partially means-tested: premiums for Part B and Part D rise with income, while eligibility and the benefits themselves do not change no matter what you earn or own. The mechanism is IRMAA — the Income-Related Monthly Adjustment Amount — which adds surcharges of $95.70 to $578.00 a month once modified adjusted gross income passes $109,000 for single filers or $218,000 for joint filers, per the Social Security Administration.
Revised: 7/24/26
Jason Baar
Fee-Only Medicare Advisor
NPN #2033715
This free printable PDF explains the Medicare surcharge in plain language for people seeing it for the first time, with the Part B and Part D tables in one place. No email address or form.
The long answer
It is an income test, not an asset test. The size of your savings, portfolio, or home never enters the calculation — only modified adjusted gross income, meaning adjusted gross income plus tax-exempt interest, taken from your federal return of two years earlier.
The means testing touches a minority: roughly 8% of people on Medicare pay an IRMAA surcharge, per the Centers for Medicare & Medicaid Services. Part A, hospital insurance, is untouched by income — it remains premium-free for most people at every income level.
The practical consequence of income-based rather than asset-based testing is control. Retirees decide, to a meaningful degree, what their measured income is each year — which account a withdrawal comes from, when a gain is realized, whether a conversion happens now or later. That is why the same portfolio can produce very different Medicare premiums depending on how it is drawn down.
Printed from JasonKnowsMedicare.com — “Medicare Means Testing: How Income Sets Your Premiums”. The free guide What Medicare Actually Costs at Higher Incomes is available at JasonKnowsMedicare.com/pages/free-medicare-guides · Questions: (850) 810-1000
You can find all 10 free Medicare guides as PDFs on the Free Medicare Guides page.
This page is educational information, not personal financial, tax, or legal advice. For decisions about your own situation, talk with a qualified professional.