Medicare Part D
How Income Triggers Medicare Part B and D Surcharges in Newark
NEWARK, N.J. — As Medicare's Annual Enrollment Period runs through Dec. 7, higher-earning retirees in Newark and across Essex County are taking a closer look at something that catches many people off guard: the income-related surcharge that can raise both Part B and Part D premiums in 2027.
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Click to call 855-729-3240Key takeaways
- Medicare's Annual Enrollment Period runs through Dec. 7, and it's a good time to check whether the IRMAA income surcharge will affect your 2027 Part B and Part D premiums.
- For 2026, the surcharge starts when a single filer's income is above $109,000, or above $218,000 for a married couple filing jointly, and it uses your income from two years earlier.
- The Social Security Administration mails a notice, usually in late fall, showing the income used and the surcharge that will start in January, and you can file Form SSA-44 to ask for a review if you've had a life-changing event that lowered your income.
- The IRMAA surcharge amount stays the same no matter which Part D plan you choose, but each plan's base premium, drug list, and pharmacy network can differ, so it's worth checking your medications against next year's coverage before enrollment ends.
The rule is called IRMAA — the Income-Related Monthly Adjustment Amount. It isn't a penalty, and it isn't optional. If your income crosses certain thresholds, Social Security automatically adds a surcharge to your monthly Medicare bill. Here's what to know before the year ends.
What IRMAA actually is
Most people pay the standard Part B premium and whatever their Part D plan charges for prescription coverage. But if your income is above a set threshold, Medicare adds an extra amount on top of both. That extra amount is IRMAA.
Two important points:
- It applies to Part B and Part D separately. You can owe a surcharge on one, the other, or both.
- It's based on your tax return from two years ago. Your 2027 IRMAA is based on the income reported on your 2025 federal tax return.
That two-year lookback trips up a lot of new retirees, because the income Medicare uses may not reflect what you're earning today.
The 2027 income thresholds
For 2026, IRMAA surcharges begin when a single filer's modified adjusted gross income (MAGI) is above $109,000, or above $218,000 for a married couple filing jointly. Below those numbers, you pay only the standard Part B premium and your plan's regular Part D premium.
Above the first threshold, surcharges rise in tiers. The highest tier applies to single filers with income at or above roughly $500,000 (or $750,000 for joint filers). The higher your income, the larger the monthly add-on for both Part B and Part D.
CMS publishes the official 2027 Part B premium and the full IRMAA tier chart later in the fall; when posted, they appear at Medicare.gov under "Costs."
How you'll be notified
If IRMAA applies to you, the Social Security Administration mails a predetermination notice — usually in late fall — showing the income they used and the surcharge you'll owe starting in January. The Part B portion is typically deducted from your Social Security check. The Part D portion is billed separately, even if your drug plan premium is normally deducted from Social Security.
Open the letter when it arrives. If the income figure looks wrong, you have the right to respond.
When you can appeal
You can ask Social Security to reconsider your IRMAA if you've had a life-changing event that reduced your income. Qualifying events include:
- Marriage, divorce, or the death of a spouse
- You or your spouse stopped working or reduced hours
- Loss of income-producing property (not due to your own actions)
- Loss or reduction of a pension
You file Form SSA-44 with documentation. If your 2025 income was unusually high because of a one-time event — selling a home, a large Roth conversion, a severance payment — that alone doesn't qualify, but it's worth calling Social Security to confirm your situation.
By the numbers
Medicare Part B premium, 2006–2026
The standard monthly Part B premium has climbed from $88.50 in 2006 to $202.90 in 2026. Hover any point for that year’s premium.
Source: CMS. Standard premium shown; in some hold-harmless years many existing enrollees paid less. Confirm at Medicare.gov.
By the numbers
How people get Medicare in Essex County
(MA penetration in Essex County)
MA penetration from CMS enrollment data; Medigap share is an estimate. U.S. average is about 54% Medicare Advantage. These are area-level figures, not plan-specific.
Other 2027 changes worth knowing
IRMAA gets the attention, but a few other Part D changes affect everyone with drug coverage:
- The Part D out-of-pocket cap is $2,100 in 2026. Once your covered drug costs hit that amount, you pay $0 for covered prescriptions the rest of the year.
- The maximum Part D deductible is $615.
- The old coverage gap (the "donut hole") was eliminated in 2025. Part D now has three phases instead of four.
- The Medicare Prescription Payment Plan lets you spread your out-of-pocket drug costs across the calendar year in monthly installments, at no extra charge. You have to opt in through your drug plan.
What Newark residents can do before Dec. 7
Newark is in Essex County, where Medicare beneficiaries have a wide range of stand-alone Part D and Medicare Advantage options during Annual Enrollment. For 2027, Essex County has 46 Medicare Advantage plans from 9 carriers. If IRMAA is going to apply to you in 2027, the surcharge is the same no matter which Part D plan you pick — but the plan's base premium, formulary, and pharmacy network still vary. Reviewing your drug list against next year's formulary is the single most useful step you can take this month.
If you're already retired and your income has dropped since 2025, gather documentation now so you're ready to file SSA-44 as soon as your IRMAA notice arrives.
Higher-income surcharges
2027 IRMAA income brackets
If your income is above a threshold, you pay an income-related surcharge (IRMAA) on top of your Part B and Part D premiums. Your 2027 surcharge is based on your 2025 tax return. CMS publishes the 2027 brackets and surcharge amounts later in the fall.
| Income — single filer | Income — married, joint | Part B monthly premium | Part D surcharge |
|---|---|---|---|
| $109,000 or less | $218,000 or less | $202.90 | Plan premium only |
| $109,001 – $137,000 | $218,001 – $274,000 | $284.10 | + $14.50 |
| $137,001 – $171,000 | $274,001 – $342,000 | $405.80 | + $37.40 |
| $171,001 – $205,000 | $342,001 – $410,000 | $527.50 | + $60.40 |
| $205,001 – $500,000 | $410,001 – $750,000 | $649.30 | + $83.30 |
| Above $500,000 | Above $750,000 | $689.90 | + $91.00 |
Standard Part B premium is $202.90/month. Part D surcharges are added to your drug plan’s premium. Married-filing-separately uses a different, compressed schedule. Confirm current amounts at Medicare.gov.
Try it
Find your 2026 Medicare premium
Most people pay the standard Part B premium. If your 2024 income was higher, an income-related surcharge (IRMAA) applies. Enter your details to see your bracket.
Surcharges are added to your premiums and based on your 2024 tax return. Married-filing-separately uses a different schedule. Confirm at Medicare.gov.
Try it
How the 2026 Part D drug cap works
Slide to your estimated yearly prescription costs and see how the new $2,100 out-of-pocket cap protects you. This illustrates the standard Part D benefit; your plan may structure costs differently.
Once your out-of-pocket spending on covered drugs reaches $2,100, you pay nothing more for the rest of 2026. Confirm details at Medicare.gov.
Good to know
Frequently asked questions
Q: I just retired this year. Will Medicare use my old salary to set my 2027 premium?
Q: Does IRMAA go away once I drop below the threshold?
Q: Do Medicare Advantage members pay IRMAA?
- CMS — Medicare costs & IRMAA (medicare.gov)
For personalized answers, contact Medicare.gov, 1-800-MEDICARE, or your local SHIP.