Medicare eligibility is not based on income. Anyone who qualifies by age (65 or older) or disability can enroll regardless of how much they earn. However, income directly affects how much you pay. Higher earners pay larger monthly premiums for Part B (medical insurance) and Part D (prescription drug coverage), while lower-income beneficiaries may qualify for programs that reduce or eliminate their costs entirely.
How Income Affects Part B Premiums
The standard monthly premium for Medicare Part B is $185.00 in 2025. Most enrollees pay this amount. But if your income exceeds certain thresholds, Social Security adds a surcharge called the Income-Related Monthly Adjustment Amount (IRMAA) on top of the standard premium.
For 2025, the income brackets work like this for individual filers (double these numbers for joint filers):
- $106,000 or less: $185.00 per month (standard premium, no surcharge)
- $106,001 to $133,000: roughly $259 per month
- $133,001 to $167,000: roughly $370 per month
- $167,001 to $200,000: roughly $480 per month
- $200,001 to $499,999: roughly $591 per month
- $500,000 or more: roughly $628 per month
At the highest income level, you pay more than three times what most people pay. These brackets adjust slightly each year. For 2026, the standard premium rises to $202.90, and the top bracket reaches $689.90 per month.
How Income Affects Part D Premiums
The same income thresholds that trigger higher Part B premiums also apply to Part D prescription drug plans. You still pay whatever your drug plan charges, but Social Security adds a monthly surcharge on top. In 2025, these surcharges range from $13.70 at the lowest affected bracket to $85.80 at the highest. The brackets mirror the Part B thresholds: individual filers above $106,000, joint filers above $212,000.
If you file as married filing separately, the brackets are compressed. You jump from the standard premium straight to the second-highest surcharge ($78.60) once your income exceeds $106,000, with no intermediate steps until $394,000.
Which Income Number Medicare Uses
Medicare doesn’t look at your current paycheck or bank balance. It uses a figure called Modified Adjusted Gross Income (MAGI), which is your adjusted gross income (line 11 on your 1040 tax return) plus any tax-exempt interest income (line 2a). That includes things like municipal bond interest that don’t count as taxable income elsewhere.
The key detail many people miss: Medicare uses your tax return from two years ago. Your 2025 premiums are based on your 2023 tax return. Your 2026 premiums will use your 2024 return. This lag means a big income year, such as selling a home or cashing out retirement accounts, can surprise you with higher premiums two years later.
Appealing a Higher Premium
If your income has dropped significantly since the tax year Medicare is using, you can ask Social Security to use more recent income instead. You’ll need to file a form (SSA-44) and show that one of eight qualifying life-changing events caused the drop:
- Death of a spouse
- Marriage
- Divorce or annulment
- Reduction in work hours
- Stopping work entirely
- Loss of income-producing property
- Loss of an employer pension
- Receipt of a settlement from a current or former employer
Retirement is one of the most common reasons people file this appeal. If you earned $180,000 in your last working year but now live on $50,000 in retirement income, you shouldn’t be stuck paying surcharges based on old earnings. The appeal process lets you correct for that two-year lag.
Part A and Income
Medicare Part A (hospital insurance) works differently. Most people pay nothing for Part A because they or a spouse earned enough work credits through payroll taxes during their career. If you don’t have enough work credits, you can still enroll, but you’ll pay a monthly premium. That premium is not income-based; it’s the same flat amount regardless of earnings.
There’s also a late enrollment penalty. If you were eligible for Part A and didn’t sign up, your premium can increase by up to 10%, and you’ll pay that higher amount for twice the number of years you could have been enrolled but weren’t.
Help for Lower-Income Beneficiaries
While high earners pay more, the system also works in the other direction. Several programs reduce Medicare costs for people with limited income and savings.
Medicare Savings Programs
These state-run programs help pay Part B premiums, deductibles, and copays. For 2026, the income and asset limits are:
- Qualified Medicare Beneficiary (QMB): covers Part A and B premiums, deductibles, and cost-sharing. Individual income limit of $1,350 per month with resources under $9,950.
- Specified Low-Income Medicare Beneficiary (SLMB): covers Part B premiums only. Individual income limit of $1,616 per month.
- Qualifying Individual (QI): also covers Part B premiums. Individual income limit of $1,816 per month.
Married couples have higher limits (roughly 35% more), and Alaska and Hawaii have slightly higher thresholds than the rest of the country. Some states set their own limits above the federal minimums, so it’s worth checking your state’s Medicaid office even if you’re slightly over these numbers.
Extra Help With Drug Costs
The Extra Help program (also called the Low Income Subsidy) reduces Part D prescription drug premiums, deductibles, and copays. To qualify in 2025, your annual income must be below $23,475 for an individual or $31,725 for a married couple, and your countable resources must be under $18,090 (individual) or $36,100 (couple). Resources include savings and investments but typically exclude your home and car.
The Big Picture
About 93% of Medicare beneficiaries fall below the first IRMAA threshold and pay the standard Part B premium. Income-based surcharges affect roughly 7% of enrollees. On the other end, millions of beneficiaries qualify for savings programs that reduce their costs below the standard amount. Your income won’t prevent you from getting Medicare, but it will shape what you pay once you’re enrolled.