Amount of premiums for individuals enrolled under this part
Determination of monthly actuarial rates and premiums
The Secretary shall, during September of 1983 and of each year thereafter, determine the monthly actuarial rate for enrollees age 65 and over which shall be applicable for the succeeding calendar year. Subject to paragraphs (5), (6), and (7), such actuarial rate shall be the amount the Secretary estimates to be necessary so that the aggregate amount for such calendar year with respect to those enrollees age 65 and older will equal one-half of the total of the benefits and administrative costs which he estimates will be payable from the Federal Supplementary Medical Insurance Trust Fund for services performed and related administrative costs incurred in such calendar year with respect to such enrollees. In calculating the monthly actuarial rate, the Secretary shall include an appropriate amount for a contingency margin. In applying this paragraph there shall not be taken into account additional payments under section 1395w–4(o) of this title and section 1395w–23(l)(3) of this title and the Government contribution under section 1395w(a)(3) of this title.
The monthly premium of each individual enrolled under this part for each month after December 1983 shall be the amount determined under paragraph (3), adjusted as required in accordance with subsections (b), (c), (f), and (i), and to reflect any credit provided under section 1395w–24(b)(1)(C)(ii)(III) of this title.
The Secretary, during September of each year, shall determine and promulgate a monthly premium rate for the succeeding calendar year that (except as provided in subsection (g)) is equal to 50 percent of the monthly actuarial rate for enrollees age 65 and over, determined according to paragraph (1), for that succeeding calendar year. Whenever the Secretary promulgates the dollar amount which shall be applicable as the monthly premium rate for any period, he shall, at the time such promulgation is announced, issue a public statement setting forth the actuarial assumptions and bases employed by him in arriving at the amount of an adequate actuarial rate for enrollees age 65 and older as provided in paragraph (1).
The Secretary shall also, during September of 1983 and of each year thereafter, determine the monthly actuarial rate for disabled enrollees under age 65 which shall be applicable for the succeeding calendar year. Such actuarial rate shall be the amount the Secretary estimates to be necessary so that the aggregate amount for such calendar year with respect to disabled enrollees under age 65 will equal one-half of the total of the benefits and administrative costs which he estimates will be payable from the Federal Supplementary Medical Insurance Trust Fund for services performed and related administrative costs incurred in such calendar year with respect to such enrollees. In calculating the monthly actuarial rate under this paragraph, the Secretary shall include an appropriate amount for a contingency margin.
In applying this part (including subsection (i) and section 1395l(b) of this title), the monthly actuarial rate for enrollees age 65 and over for 2016 shall be determined as if subsection (f) did not apply.
Subsection (f) shall continue to be applied to paragraph (6)(A) (during a repayment month, as described in paragraph (6)(B)) and without regard to the application of subparagraph (A).
With respect to a repayment month (as described in subparagraph (B)), the monthly premium otherwise established under paragraph (3) shall be increased by, subject to subparagraph (D), $3.
For purposes of this paragraph, a repayment month is a month during a year, beginning with 2016, for which a balance due amount is computed under subparagraph (C) as greater than zero.
For purposes of this paragraph, the balance due amount computed under this subparagraph, with respect to a month, is the amount estimated by the Chief Actuary of the Centers for Medicare & Medicaid Services to be equal to—
the amount transferred under subsections (d)(1) and (e)(1) of section 1395w of this title; plus
the amount that is equal to the aggregate reduction, for all individuals enrolled under this part, in the income related monthly adjustment amount as a result of the application of paragraphs (5) and (7); minus
the amounts payable under this part as a result of the application of this paragraph for preceding months.
If the balance due amount computed under subparagraph (C), without regard to this subparagraph, for December of a year would be less than zero, the Chief Actuary of the Centers for Medicare & Medicaid Services shall estimate, and the Secretary shall apply, a reduction to the dollar amount increase applied under subparagraph (A) for each month during such year in a manner such that the balance due amount for January of the subsequent year is equal to zero.
In applying this part (including subsection (i) and section 1395l(b) of this title), the monthly actuarial rate for enrollees age 65 and over for 2021 shall be determined to be equal to the sum of—
the monthly actuarial rate for enrollees age 65 and over for 2020; plus
25 percent of the difference between such rate for 2020 and the preliminary monthly actuarial rate for enrollees age 65 and over for 2021 (as estimated under subparagraph (B)).
For purposes of subparagraph (A)(ii), the Secretary shall estimate a preliminary monthly actuarial rate for enrollees age 65 and over for 2021 using the methodology described in paragraph (1) and as if subparagraph (A) of this paragraph did not apply. The Secretary shall make the estimate under the previous sentence as if the transfers described in section 1395w(f)(1) of this title have been made.
Increase in monthly premium
Premiums rounded to nearest multiple of ten cents
“Continuous period of eligibility” defined
State payment of part B late enrollment premium increases
Upon the request of a State (or any appropriate State or local governmental entity specified by the Secretary), the Secretary may enter into an agreement with the State (or such entity) under which the State (or such entity) agrees to pay on a quarterly or other periodic basis to the Secretary (to be deposited in the Treasury to the credit of the Federal Supplementary Medical Insurance Trust Fund) an amount equal to the amount of the part B late enrollment premium increases with respect to the premiums for eligible individuals (as defined in paragraph (3)(A)).
No part B late enrollment premium increase shall apply to an eligible individual for premiums for months for which the amount of such an increase is payable under an agreement under paragraph (1).
In this subsection:
The term “eligible individual” means an individual who is enrolled under this part B and who is within a class of individuals specified in the agreement under paragraph (1).
The term “part B late enrollment premium increase” means any increase in a premium as a result of the application of subsection (b).
Limitation on increase in monthly premium
Exclusions from estimate of benefits and administrative costs
In estimating the benefits and administrative costs which will be payable from the Federal Supplementary Medical Insurance Trust Fund for a year for purposes of determining the monthly premium rate under subsection (a)(3), the Secretary shall exclude an estimate of any benefits and administrative costs attributable to—
the application of section 1395x(v)(1)(L)(viii) of this title or to the establishment under section 1395x(v)(1)(L)(i)(V) of this title of a per visit limit at 106 percent of the median (instead of 105 percent of the median), but only to the extent payment for home health services under this subchapter is not being made under section 1395fff of this title (relating to prospective payment for home health services); and
the medicare prescription drug discount card and transitional assistance program under section 1395w–141 of this title.
Potential application of comparative cost adjustment in CCA areas
In general
No effect on late enrollment penalty or income-related adjustment in subsidies
Implementation
In order to carry out a premium adjustment under this subsection and section 1395w–29(f) 1 of this title (insofar as it is effected through the manner of collection of premiums under section 1395s(a) of this title), the Secretary shall transmit to the Commissioner of Social Security—
at the beginning of each year, the name, social security account number, and the amount of the premium adjustment (if any) for each individual enrolled under this part for each month during the year; and
periodically throughout the year, information to update the information previously transmitted under this paragraph for the year.
Reduction in premium subsidy based on income
In general
Threshold amount
For purposes of this subsection, subject to paragraph (6), the threshold amount is—
except as provided in subparagraph (B), $80,000 (or, beginning with 2018, $85,000), and
in the case of a joint return, twice the amount applicable under subparagraph (A) for the calendar year.
Monthly adjustment amount
In general
Subject to subparagraph (B), the monthly adjustment amount specified in this paragraph for an individual for a month in a year is equal to the product of the following:
Sliding scale percentage
Unsubsidized part B premium amount
200 percent of the monthly actuarial rate for enrollees age 65 and over (as determined under subsection (a)(1) for the year); plus
4 times the amount of the increase in the monthly premium under subsection (a)(6) for a month in the year.
3-year phase in
The monthly adjustment amount specified in this paragraph for an individual for a month in a year before 2009 is equal to the following percentage of the monthly adjustment amount specified in subparagraph (A):
For 2007, 33 percent.
For 2008, 67 percent.
Applicable percentage
In general
Subject to paragraphs (5) and (6), for years before 2018:
If the modified adjusted gross income is: | The applicable percentage is: |
|---|---|
More than $80,000 but not more than $100,000 | 35 percent |
More than $100,000 but not more than $150,000 | 50 percent |
More than $150,000 but not more than $200,000 | 65 percent |
More than $200,000 | 80 percent. |
Subject to paragraph (5), for 2018:
If the modified adjusted gross income is: | The applicable percentage is: |
|---|---|
More than $85,000 but not more than $107,000 | 35 percent |
More than $107,000 but not more than $133,500 | 50 percent |
More than $133,500 but not more than $160,000 | 65 percent |
More than $160,000 | 80 percent. |
Subject to paragraph (5), for years beginning with 2019:
If the modified adjusted gross income is: | The applicable percentage is: |
|---|---|
More than $85,000 but not more than $107,000 | 35 percent |
More than $107,000 but not more than $133,500 | 50 percent |
More than $133,500 but not more than $160,000 | 65 percent |
More than $160,000 but less than $500,000 | 80 percent |
At least $500,000 | 85 percent. |
Joint returns
Married individuals filing separate returns
In the case of an individual who—
is married as of the close of the taxable year (within the meaning of section 7703 of the Internal Revenue Code of 1986) but does not file a joint return for such year, and
does not live apart from such individual’s spouse at all times during the taxable year,
clause (i) shall be applied by reducing each of the dollar amounts otherwise applicable under such clause for the calendar year by the threshold amount for such year applicable to an unmarried individual.
Modified adjusted gross income
In general
For purposes of this subsection, the term “modified adjusted gross income” means adjusted gross income (as defined in section 62 of the Internal Revenue Code of 1986)—
determined without regard to sections 135, 911, 931, and 933 of such Code; and
increased by the amount of interest received or accrued during the taxable year which is exempt from tax under such Code.
In the case of an individual filing a joint return, any reference in this subsection to the modified adjusted gross income of such individual shall be to such return’s modified adjusted gross income.
Taxable year to be used in determining modified adjusted gross income
In general
Temporary use of other data
Non-filers
In the case of individuals with respect to whom the Secretary of the Treasury does not have adequate data in appropriate electronic form for either taxable year referred to in clause (i) or clause (ii), the Commissioner of Social Security, in consultation with the Secretary, shall prescribe regulations which provide for the treatment of the premium adjustment with respect to such individual under this subsection, including regulations which provide for—
the application of the highest applicable percentage under paragraph (3)(C) to such individual if the Commissioner has information which indicates that such individual’s modified adjusted gross income might exceed the threshold amount for the taxable year referred to in clause (i), and
proper adjustments in the case of the application of an applicable percentage under subclause (I) to such individual which is inconsistent with such individual’s modified adjusted gross income for such taxable year.
Use of more recent taxable year
In general
The Commissioner of Social Security in consultation with the Secretary of the Treasury shall establish a procedures under which an individual’s modified adjusted gross income shall, at the request of such individual, be determined under this subsection—
for a more recent taxable year than the taxable year otherwise used under subparagraph (B), or
by such methodology as the Commissioner, in consultation with such Secretary, determines to be appropriate, which may include a methodology for aggregating or disaggregating information from tax returns in the case of marriage or divorce.
Standard for granting requests
A request under clause (i)(I) to use a more recent taxable year may be granted only if—
the individual furnishes to such Commissioner with respect to such year such documentation, such as a copy of a filed Federal income tax return or an equivalent document, as the Commissioner specifies for purposes of determining the premium adjustment (if any) under this subsection; and
the individual’s modified adjusted gross income for such year is significantly less than such income for the taxable year determined under subparagraph (B) by reason of the death of such individual’s spouse, the marriage or divorce of such individual, or other major life changing events specified in regulations prescribed by the Commissioner in consultation with the Secretary.
Inflation adjustment
In general
Subject to subparagraph (C), in the case of any calendar year beginning after 2007 (other than 2018 and 2019), each dollar amount in paragraph (2) or (3) shall be increased by an amount equal to—
such dollar amount, multiplied by
the percentage (if any) by which the average of the Consumer Price Index for all urban consumers (United States city average) for the 12-month period ending with August of the preceding calendar year exceeds such average for the 12-month period ending with August 2006 (or, in the case of a calendar year beginning with 2020, August 2018).
Rounding
Treatment of adjustments for certain higher income individuals
In general
Adjustment beginning 2028
In the case of any calendar year beginning after 2027, each dollar amount in paragraph (3) of $500,000 shall be increased by an amount equal to—
such dollar amount, multiplied by
the percentage (if any) by which the average of the Consumer Price Index for all urban consumers (United States city average) for the 12-month period ending with August of the preceding calendar year exceeds such average for the 12-month period ending with August 2026.
Temporary adjustment to income thresholds
Notwithstanding any other provision of this subsection, during the period beginning on
the threshold amount otherwise applicable under paragraph (2) shall be equal to such amount for 2010; and
the dollar amounts otherwise applicable under paragraph (3)(C)(i) shall be equal to such dollar amounts for 2010.
Joint return defined
Source
(Aug. 14, 1935, ch. 531, title XVIII, § 1839, as added Pub. L. 89–97, title I, § 102(a),Notes
References in Text
Amendments
Effective Date of 2006 Amendment
Effective Date of 2003 Amendment
Effective Date of 2000 Amendment
Effective Date of 1997 Amendment
Effective Date of 1994 Amendment
Effective Date of 1989 Amendment
Effective Date of 1988 Amendment
Effective Date of 1986 Amendment
Effective Date of 1984 Amendment
Effective Date of 1983 Amendment; Transitional Rule
the monthly premiums under part A and under part B of title XVIII of the Social Security Act [42 U.S.C. 1395c et seq., 1395j et seq.] for individuals enrolled under each respective part shall be the monthly premium under that part for the month of June 1983, and
the amount of the Government contributions under section 1844(a)(1) of such Act [42 U.S.C. 1395w(a)(1)] shall be computed on the basis of the actuarially adequate rate which would have been in effect under part B of title XVIII of such Act for such months without regard to the amendments made by this section, but using the amount of the premium in effect for the month of June 1983.”
Effective Date of 1981 Amendment
Effective Date of 1980 Amendment
Effective Date of 1977 Amendment
Effective Date of 1975 Amendment
Effective Date of 1968 Amendment
Construction Regarding No Authority To Initiate Application to Years After 2017
Conditional Application to 2017 if No Social Security COLA for 2017
“If there is no increase in the monthly insurance benefits payable under title II [probably means title II of act Aug. 14, 1935, ch. 531, which is classified to 42 U.S.C. 401 et seq.] with respect to December 2016 pursuant to section 215(i) [probably means section 215(i) of act Aug. 14, 1935, ch. 531, which is classified to 42 U.S.C. 415(i)], then the amendments made by this section [amending this section and secton 1395w of this section] shall be applied as if—
the reference to ‘2016’ in paragraph (5)(A) of section 1839(a) of the Social Security Act (42 U.S.C. 1395r(a)), as added by subsection (a)(2), was a reference to ‘2016 and 2017’;
the reference to ‘a month during a year, beginning with 2016’ in paragraph (6)(B) of section 1839 of such Act (42 U.S.C. 1395r(a)), as added by subsection (a)(2), was a reference to ‘a month in a year, beginning with 2016 and beginning with 2017, respectively’; and
the reference to ‘2016’ in subsection (d)(1) of section 1844 of such Act (42 U.S.C. 1395w), as added by subsection (b)(2), was a reference to ‘each of 2016 and 2017’
Any increase in premiums effected under this subsection shall be in addition to the increase effected by the amendments made by subsection (a) [amending this section].”
No Change in Medicare’s Defined Benefit Package
Determination of Premium Amounts by Secretary
the dollar amount applicable for premiums under part B of title XVIII of such Act [42 U.S.C. 1395j et seq.] for each month before April 1968 shall be $3, and
the Secretary of Health, Education, and Welfare may determine and promulgate such dollar amount for months after March 1968 and before January 1970 at any time on or before