Medicare premiums vary depending on the type of Medicare coverage you have. Most people do not pay a premium for Medicare Part A. However, Medicare Part B comes with a premium, and so does Medicare Part C and D. As such, seniors should be mindful of the amount they should be paying each month for their premiums. There may be instances where you can receive a refund of your premium, and this article will review some of these important scenarios.
What is a Medicare premium refund?
Medicare may issue a monthly premium refund under certain conditions. Generally, refunds are issued due to overpayments, such as the death of a Medicare beneficiary or overpayment due to being charged incorrectly by Medicare. Examples of such charges include an inaccurate late enrollment penalty or a premium surcharge.
Who qualifies for a Medicare premium refund?
There are several scenarios in which a Medicare beneficiary may be eligible for a premium refund. Some common scenarios are listed below.
- Refund of late enrollment penalties. If you were incorrectly charged a late enrollment penalty when you were eligible for a special enrollment, you may be eligible for a refund.
- Refunds due to premium billing errors. Sometimes billing errors happen. If you think you are being charged more than the standard amount or the adjustment based on your income is incorrect, you may consider requesting a refund.
- Removal of premium surcharges. Medicare Part B provides medical insurance and Medicare Part D covers prescription drugs. Both of these coverage options require you to pay a monthly plan premium. If your income is above a certain amount, you may pay an extra amount each month in addition to your Medicare Part B or D premium called an income-related monthly adjustment amount (IRMAA). If your income changed and you were charged this surcharge incorrectly, you may be eligible for a refund.
- Deceased beneficiary. An overpayment could also occur if the Medicare beneficiary received any Social Security benefits while alive. Oftentimes, payment for Medicare coverage is taken out of your Social Security benefits in advance. This means if the policyholder passed away in July, the Social Security benefit they received that same month already includes the deducted Medicare premium cost from their benefit that applies to the month of August.
How to get a Medicare premium refund
To apply for a refund, you have to follow the steps outlined by the Social Security Administration (SSA). You can contact the SSA directly, and a representative will be able to assist you with submitting the claim. Be sure to complete all required forms in their entirety and be prepared to provide proof of overpayment with documentation such as receipts, or bank statements.
If you are filing a claim on behalf of a deceased Medicare beneficiary, be sure to submit your claim within 12 months after the date of their passing. If you fail to file your claim in this 12-month window, you may lose out on receiving your Medicare premium overpayment refund. This applies to both loved ones and family members as well as personal or legal representatives acting on the deceased beneficiary’s behalf.
Filing an appeal
If Medicare does not approve your refund request, you can file an appeal. The appeals process varies based on the type of coverage you have, but in general, there are five levels to the appeals process. You can continue to advance your appeal through all five stages until a final decision is made at the 5th level. For more information on filing an appeal, you can visit the Centers for Medicare and Medicaid Services.
How are Medicare premiums calculated?
The Medicare program consists of several different parts, and the amount of your monthly Medicare premiums varies based on your coverage. The monthly premium for Medicare Part A for most people is $0 because Medicare taxes were paid while working. For those who are not eligible to receive Medicare Part A without a premium, the premium will be $278 or $505 each month and is based on how long you or your spouse worked and paid Medicare taxes. Additionally, you will need to be enrolled in Medicare Part B to purchase Part A.
Calculating Medicare premiums becomes more complex if you have a higher total adjusted gross income. The premium for Medicare Part B in 2024 will be at least $174.70 per month. For individuals with Medicare Part B, you may be subject to an income-related monthly adjustment amount and pay higher premiums. If when you filed your taxes in 2022 your modified adjusted gross income was more than $103,000 filing individually and more than $206,000 filing jointly, you will likely pay more than the base Part B premium of $174.70 per month.
Medicare prescription drug coverage premiums for Medicare Part D plans vary based on the plan you have chosen and are also subject to an income-related monthly adjustment amount surcharge. Additionally, you could also be charged a penalty for not enrolling in Medicare Part D when you initially obtained Medicare coverage. This penalty will be added to your premium each month.
Individuals with a Medicare Advantage Plan, also known as Medicare Part C, will have various premiums based on where you live, the policy purchased, and other factors.
Common issues and how to avoid overpayments
Obtaining a Medicare premium refund can be challenging and requires several steps. Listed below are a few considerations to help you avoid Medicare overpayments.
- Monitor your monthly premiums. Monitoring the amount you pay for your Medicare premium each month. If you notice any unexpected changes to your premium, contact your insurance company.
- Ensure your income data is accurate. Update your income information each year so that your premiums for Medicare Part B and Medicare Part D are accurate.
- Avoid late penalties. If you do not enroll in Medicare Part D when you are eligible, maintain proof of your other eligible medical insurance to ensure you are not charged a late penalty if you decide to enroll in Medicare Part D later. If you enroll in Medicare Part B, it is best to enroll during a Special Enrollment Period to avoid late penalties.
Requesting a Medicare premium requires meeting specific criteria, and it is important to have accurate and complete documentation justifying your request. Review your statements regularly and contact Medicare as soon as possible if you notice any discrepancies.
FAQ
How long do I have to submit a Medicare premium refund request?
For deceased beneficiaries, their family members or legal representatives should submit a refund request within 12 months of their death. If you wait too long to submit your request, it can be denied, and you won’t receive any refund.
Can I receive a refund payment from Social Security?
Yes, you may be eligible, as in many cases, the Medicare premium cost is often deducted from the monthly Social Security benefit. If the policyholder’s premium cost was withdrawn from their Social Security benefits after their death, you can request a refund.
How do I submit a Medicare premium refund request?
A loved one or legal representative can contact the insurance company, Medicare, or the Social Security Administration to discuss a refund request. SSA Form 1724 can be submitted for payments owed to a beneficiary before their death.
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Medicare will issue a premium refund to individuals under certain conditions such as overpayment due to the death of the beneficiary.
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Contact Medicare and submit a request for a refund as soon as you notice a potential overpayment. Have appropriate documentation readily available.
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For individuals with Medicare Part B and D, contact your plan directly for assistance with obtaining a refund.
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Monitor the amount you pay for Medicare premiums closely each month to avoid substantial overpayment of premiums.
6 resources
- Social Security. Refunding excess Medicare premiums.
- Social Security. Form SSA-1724.
- Social Security. Claim for amounts due in the case of deceased beneficiary.
- CMS. What does Medicare cost?
- CMS. Avoid late enrollment penalties.
- CMS. Filing an appeal.
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