Medicare Enrollment and IRMAA: Deadlines, Choices and Surcharges

Part A is free for most people, Part B costs $202.90 a month, and Part D depends on the plan you choose. The Part B deductible for 2026 is $283 and the Part A hospital deductible is $1,736 per benefit period (CMS, 2026). You get premium-free Part A if you or your spouse paid Medicare taxes long enough, usually ten years of work. Otherwise Part A costs $311 a month with 30 to 39 quarters of coverage or $565 with fewer.

Part D, the drug benefit, is sold by private plans, so premiums vary by plan and ZIP code. Two 2026 figures are fixed by law: no plan's deductible can exceed $615, and once your own spending on covered drugs reaches $2,100, you pay nothing more for covered drugs for the rest of the year (Medicare.gov, 2026). That cap is new enough that many retirees who skipped Part D years ago never priced it again. If you take expensive medications, it changes the math.

Two things Medicare does not cover matter a great deal at this stage of life: most dental, vision and hearing care, and long-term custodial care. The first is a budgeting item. The second is a planning problem of its own, covered in our long-term care guide. Our Healthcare Cost Estimator puts premiums, deductibles and out-of-pocket costs into one annual figure.

During the seven-month Initial Enrollment Period that runs from three months before the month you turn 65 to three months after it (Medicare.gov). If you sign up in the three months before your birthday month, coverage starts the month you turn 65. If you sign up in your birthday month or later, coverage starts the month after you sign up (Medicare.gov). Signing up early costs nothing and avoids a gap.

If you already receive Social Security benefits when you turn 65, you are enrolled in Parts A and B automatically and your card arrives in the mail. Most readers of this site delay Social Security, often to 70, so they must enroll themselves through Social Security. Claiming Medicare at 65 and Social Security at 70 is common and allowed; the two decisions are separate. Our guide on when to claim Social Security covers the benefit side.

If you miss your Initial Enrollment Period and do not qualify for a Special Enrollment Period, you are left with the General Enrollment Period, January 1 to March 31 each year, with coverage starting the month after you sign up and penalties that may apply for life (Medicare.gov).

You can wait. If you or your spouse are still working and covered by that employer's group plan, you can sign up for Part B when you stop working without a late penalty, using an 8-month Special Enrollment Period that starts when employment ends or the coverage ends, whichever happens first (Medicare.gov). The employer needs at least 20 employees for the plan to stay primary. With a smaller employer, Medicare usually pays first and the group plan may refuse to pay claims Medicare would have covered.

Three traps catch people here. First, COBRA does not extend the eight months: the clock starts when the job ends, not when COBRA ends. Second, retiree health coverage from a former employer does not count as current employment, so a retiree plan at 65 does not let you skip Part B. Third, Part D has a separate test. You can wait on a drug plan as long as your employer's drug coverage is “creditable,” meaning at least as good as Part D. The employer sends a notice each year saying whether it is; keep those notices.

Many people still working take premium-free Part A at 65 because it costs nothing and can act as secondary hospital coverage. That is sensible unless you contribute to a health savings account. Any Medicare enrollment, including Part A alone, ends HSA contributions, as the HSA section below explains.

The Part B penalty adds 10% to your premium for each full 12-month period you could have had Part B but did not, and you pay it for as long as you have Part B (Medicare.gov). A two-year gap makes every future Part B premium 20% higher. At the 2026 standard premium, that is about $40 a month, and it grows as the premium grows.

The Part D penalty applies if you go 63 days or more in a row without Part D or other creditable drug coverage after your Initial Enrollment Period. It equals 1% of the national base beneficiary premium, $38.99 in 2026, for every full uncovered month, and it lasts as long as you have Medicare drug coverage (Medicare.gov, 2026). Thirty uncovered months adds about $11.70 a month for life.

The Part A penalty only affects people who must buy Part A: a 10% higher premium for twice the number of years they delayed. For most readers with a full work record, Part A is free and there is no Part A penalty.

Choose Original Medicare with a Medigap policy if you value any-doctor access and predictable bills, and Medicare Advantage if you value lower premiums and accept a network. Original Medicare lets you use any doctor or hospital that takes Medicare anywhere in the U.S., usually without referrals or prior authorization, but has no annual limit on your share of costs unless you add supplemental coverage. Medicare Advantage plans have a yearly out-of-pocket limit but may require network providers, referrals and prior approval, and you cannot buy Medigap to cover their cost-sharing (Medicare.gov).

For affluent retirees, the trade is usually easy to state. A Medigap policy plus a Part D plan costs more each month, often a few thousand dollars a year per person depending on state and age, but turns Medicare into near-complete coverage anywhere in the country. That matters for couples who split the year between two states, who travel, or who want access to a specific academic medical center. Medicare Advantage makes sense when you live near a strong network you like, are content to stay in it, and prefer to keep premiums low.

The timing is what makes this decision hard to reverse. Your Medigap Open Enrollment Period is the six months starting the first month you are 65 or older and enrolled in Part B. During it, you can buy any Medigap policy sold in your state and the insurer cannot turn you down for health reasons. After it ends, insurers generally do not have to sell you a policy unless you have a guaranteed issue right (Medicare.gov). One of those rights is a trial: if you join Medicare Advantage for the first time, you can switch back to Original Medicare and buy Medigap within the first 12 months. Some states add further protections, so check with your state insurance department.

IRMAA, the income-related monthly adjustment amount, is a surcharge on Part B and Part D premiums for people whose modified adjusted gross income from two years earlier is above $109,000 single or $218,000 joint (Medicare.gov, 2026). About 8% of people with Medicare pay it. For this purpose, MAGI is your adjusted gross income plus tax-exempt interest (SSA POMS HI 01101.010), which means municipal bond interest counts even though it is not taxed.

The brackets are cliffs, not slopes. One dollar over a threshold triggers the whole surcharge for that tier, for each spouse on Medicare. For a couple, crossing $218,000 by a dollar costs $95.70 a month each, or $2,296.80 a year. At the top joint tier, a couple pays $578.00 a month each above the standard, or $13,872 a year.

The Part D surcharge is collected by Social Security, deducted from your benefit no matter how you pay the plan premium, and it applies even if your drug coverage comes through a Medicare Advantage plan or an employer (Medicare.gov). If you have not claimed Social Security yet, Medicare bills you.

IRMAA is best managed two years ahead. The income that sets your premium is income you control: Roth conversions, capital gains realizations, IRA withdrawals and the timing of a home sale. A conversion that pushes you $10,000 over a threshold may still be worth doing, but price the surcharge into it. Our guide to Roth conversions before RMDs shows how to size conversions to a bracket, and qualified charitable distributions are one of the few ways to meet an RMD without raising MAGI.

File Form SSA-44 if your income fell because of a life-changing event, or ask for a reconsideration if Social Security used wrong or outdated information. The qualifying events are marriage, divorce or annulment, death of a spouse, work stoppage, work reduction, loss of income-producing property, loss of employer pension income, and receipt of certain employer settlement payments (SSA POMS HI 01120.001). You provide proof of the event and an estimate of your income for the current year, and Social Security recalculates using that year instead (SSA).

Retirement is the event that matters most for readers here. The year you stop working, your two-year-old tax return still shows a full salary, bonus and perhaps a deferred-compensation payout. Retirement counts as work stoppage, and a phased reduction in hours counts as work reduction. An estimate is enough to get the premium lowered; if your actual income later turns out higher, Social Security adjusts.

If your income stays lower the next year, you may need to file again: the following year's premium will be based on a tax return that may still include your final working year. The initial IRMAA letter explains how to disagree with the determination, and a request for a new decision can be made at any time during the year.

With the first month you are enrolled in any part of Medicare. Beginning that month, your HSA contribution limit is zero, and the rule applies to retroactive coverage too (IRS Publication 969). Premium-free Part A is backdated up to six months when you apply after 65, but never before the month you first became eligible. Contributions made during a backdated period become excess contributions subject to a 6% excise tax each year until removed.

The practical rule from Medicare is to stop contributing to your HSA six months before you retire and apply for Medicare, or before you apply for Social Security, which enrolls you in Part A automatically (Medicare.gov). If you turn 65 and simply keep working with an HSA-eligible plan without applying for anything, you can keep contributing, including the $1,000 catch-up for people 55 and older.

Stopping contributions does not stop the account's usefulness. After 65, you can use HSA money tax-free for Part B, Part D and Medicare Advantage premiums, though not for Medigap premiums (IRS Publication 969). A well-funded HSA is, in effect, a tax-free Medicare premium account. See our HSA guide for how withdrawals are taxed.

Robert turns 65 in February 2026 and works as a finance director at a company with 5,000 employees until June 30, 2026. Its high-deductible plan covers him and his wife Ann, 64, and he contributes to an HSA. They have $2.8 million invested, mostly in IRAs and 401(k)s, a paid-off house, and plan to claim Social Security at 70. Their 2024 joint MAGI, salary plus bonus plus dividends, was $310,000. They are hypothetical.

IRMAA in 2026. On $310,000 of joint 2024 MAGI, Robert lands in the $274,001–$342,000 tier: $405.80 a month for Part B and $37.50 on top of his Part D plan. That is $240.40 a month above the standard, or $1,442.40 for the six months he is on Medicare in 2026. His estimate of 2026 MAGI, with half a year of salary and their dividends, is about $175,000, under $218,000. After he files Form SSA-44 for work stoppage, Social Security uses the 2026 estimate and his premium drops to $202.90.

IRMAA in 2027. The 2027 premium would normally be based on 2025, a full working year at about $325,000. Without another SSA-44, both Robert and Ann would pay the same tier: $240.40 a month each above standard, $5,769.60 for the year. They file again with a 2027 estimate of $120,000 and pay the standard premium.

Roth conversions from 2027. Their income is now low and their RMDs are years away, which makes 2027 to 2030 a conversion window. With about $120,000 of other income, they can convert roughly $98,000 a year and stay at or below the $218,000 joint threshold two years later. Converting more might still be right for their tax plan, but now they can see the cost: the first dollar above $218,000 costs $2,296.80 in combined surcharges two years later, and the next tier starts at $274,000. They run each year's number through our Tax Bracket Calculator before converting in December.

The Medigap choice. Robert and Ann spend winters in Arizona and want access to one particular cancer center near home, so they choose Original Medicare with Medigap. Robert buys during his window in the second half of 2026; Ann buys in 2027 during hers. Had they chosen Medicare Advantage first, each would have had the 12-month trial right to switch back.