Are you aware that beginning January 1, 2011, if you are enrolled in either a Medicare Advantage Prescription Drug Plan (MAPD) or Prescription Drug Plans (PDP) and are a high-income individual, you will pay higher Part D premiums as a result of PPACA?

While it is being stated that a small percentage (approximately 5%) of Medicare beneficiaries will be impacted, very little discussion of this change has taken place.  So, it is no surprise that Seniors impacted by this change are being caught off-guard. If you received the Medicare and You 2011 handbook, you will see this change referenced on pages 75 and 134.

What constitutes a high-income individual?  If your modified adjusted gross income as reported on your IRS tax return from 2 years ago (the most recent tax return information provided to Social Security by the IRS) is above $85,000 (and you file an individual tax return) or $170,000 (and you file a joint tax return), you will pay an income-related monthly adjustment amount in addition to your Part D premium.  The income limits are the same thresholds applied to Medicare Part B premium determinations.  

How are the increased premiums determined?  The increase in Part D premiums will be a percentage based on the Part D national base premium and will apply to both MAPDs and PDPs.  This year the national base premium is $32.34. 

How do I know if I am impacted?  If you have to pay a higher amount based on your income, you will be notified by Social Security.  The income-related monthly adjustment amount will be deducted from your monthly Social Security check no matter how you pay your plan premium.  An individual will receive a direct bill if the monthly-adjusted amount is more than your Social Security check, or if you do not get a Social Security check.  Social Security Administration will continue to review life-changing events that lead to a decrease in income (similar to Part B).  Individuals will be asked to show evidence of the event and how it reduced their income.

While things in life are supposed to get simpler as we reach retirement, it seems as if healthcare becomes more confusing.  If you find all of this overwhelming, please contact an agent in Columbia at 888-445-7866 or Charleston at 800-445.7866.  An agent will assist you in making the right decision that works for you.