Top 5 Medicare Questions We Hear from Clients
When planning for retirement and stepping into it, one of the bigger topics that inevitably comes up, whether you’re approaching 65 or already there, is how Medicare factors into your overall financial plan. It’s a conversation that touches on timing, taxes, cash flow, and peace of mind. Here are the five questions we hear most often from our clients, and how we like to think through each one together.
When do I enroll, and what about my employer or retiree coverage?
Your initial enrollment window is seven months long. It opens three months before your 65th birthday and closes three months after. Miss it, and you could face a permanent penalty added to your monthly premium. That’s a costly mistake we don’t want any of our clients to make.
If you’re still working and have health coverage through your own job at a company with 20 or more employees, the rules are a little friendlier. You can wait to enroll in Medicare without penalty, and you’ll be given a special sign-up window once that coverage ends. The important caveat here is that retiree health benefits and COBRA do not count as active employer coverage. If those are your only sources of insurance, you still need to sign up for Medicare on time.
Because everyone’s health needs are different, we don’t advise on which specific Medicare plan is right for you. That’s a conversation best had with a licensed Medicare specialist. But timing your enrollment so it fits cleanly into your broader retirement plan? That’s a conversation we love having with you.
I’m already collecting Social Security. Am I automatically enrolled?
Good news here: yes, you are. If you’re already receiving Social Security benefits when you turn 65, Medicare will enroll you automatically, and your card will arrive in the mail about three months before your birthday. One less thing on your to-do list.
If you’re not yet collecting Social Security, you’ll need to sign up on your own at ssa.gov, by calling 1-800-772-1213, or by visiting your local Social Security office. Many people choose to claim Social Security and Medicare at different times, and the right strategy depends on your overall plan. That’s a planning conversation we’ll want to have together.
What is IRMAA and why does it affect my premium?
IRMAA (Income-Related Monthly Adjustment Amount) is a surcharge added to your Medicare Part B premium if your income is above a certain level. It catches many retirees off guard and is one of the most surprising facts clients learn. We often get asked if we are planning around your Medicare premiums, and the answer is YES! This is one of the reasons why we request your tax return for review.
Medicare uses your modified adjusted gross income (MAGI) from two years prior to determine whether IRMAA applies. So your 2026 premiums, for example, are based on your 2024 tax return. The income used is line 11 of your Form 1040, your MAGI, plus any tax-exempt interest income.
Another note: these levels are considered tax cliffs, not a phase-out, meaning that if you go even $1 over the income level, you will be moved into the next Medicare premium tier, and the monthly premium changes can be very costly.
| Individual Income (2024) | Married Filing Jointly (2024) | Monthly Part B Premium (2026) |
|---|---|---|
| Up to $109,000 | Up to $218,000 | $202.90 (standard) |
| $109,001 - $137,000 | $218,001 - $274,000 | $284.10 |
| $137,001 - $171,000 | $274,001 - $342,000 | $394.00 |
| $171,001 - $205,000 | $342,001 - $410,000 | $503.90 |
| $205,001 - $500,000 | $410,001 - $750,000 | $594.00 |
| Above $500,000 | Above $750,000 | $689.90 |
Why are my premiums so high, and when do they change?
If you’ve recently retired, your premiums may still reflect your higher working income from two years ago. That’s IRMAA at work. A big event like a Roth conversion, selling a business, or a large capital gain can also bump you into a higher bracket for a year.
The good news is that your premiums will drop automatically once your lower income shows up on a future tax return. And if your income fell due to a major life-changing event, such as retirement, the death of a spouse, or divorce, you don’t have to wait it out. You can appeal using Form SSA-44 at ssa.gov to have Social Security use your more recent income instead.
Premiums are updated every January, and Social Security will send you a notice in the fall if your amount changes for the new year. One more thing to keep in mind: if you’re married and both of you are collecting Social Security benefits, both of your Medicare premiums will be affected by IRMAA. A single year of higher premiums could meaningfully reduce your cash flow, which is exactly why we like to plan ahead together.
Can I change my coverage once I’m enrolled?
Yes, and there are specific windows for doing so. The main one is the Annual Enrollment Period, which runs from October 15 through December 7 every year. During that window, you can switch plans, change your drug coverage, or move between Original Medicare and Medicare Advantage. Any changes take effect on January 1st.
There’s also a Medicare Advantage Open Enrollment Period from January 1 through March 31, when you can switch Medicare Advantage plans or return to Original Medicare.
One important note: Medigap (Medicare Supplement) plans work a little differently. In most states, you’re only guaranteed access to a Medigap policy when you first sign up for Part B. After that initial window, insurers can factor in your health history, which is another reason getting your enrollment timing right from the start really matters. Choosing between Original Medicare, Medicare Advantage, and Medigap involves your specific doctors, prescriptions, and health needs, and a licensed Medicare specialist can compare your options side by side.
How Medicare Fits Into Your Bigger Picture
Medicare is a piece of your retirement income story, not a standalone decision. The choices you make about timing, IRMAA, and coverage can ripple into your cash flow, tax planning, and peace of mind for years to come. That’s exactly why we walk through these questions alongside your broader financial plan, so all the pieces fit together with clarity and confidence.
If you have questions about how Medicare fits into your retirement strategy, we’d love to chat. Your brighter retirement starts with a conversation.
~ Claire Lucchese, CFP®, ChFC®
This blog is for educational purposes only and does not constitute legal, tax, or medical advice. Medicare rules change periodically. Always verify details at Medicare.gov or with a licensed Medicare specialist. As financial advisors, we help clients understand how Medicare fits into their broader retirement income plan, but we do not recommend specific Medicare plans.