Suze Orman Just Said the Medicare Surcharge Can Add Up to $578 a Month and Most Pre-Retirees Have Never Heard of It

On her September 15, 2022 podcast episode Ask Suze & KT Anything: Diversification, The 5 Year Rule and IRMAA, Suze Orman walked listeners through one of the most expensive surprises in retirement: “IRMAA stands for Income Related Monthly Adjustment Amount.” Then she landed the number that should command every pre-retiree’s attention. “It can be anywhere for part B from $170 a month more to $578 a month more.”

Those figures came from 2022. By 2026, the math has shifted considerably. According to Kiplinger, the standard Medicare Part B premium is now $202.90 per month, a $17.90 jump from the 2025 rate of $185.00. The Part B IRMAA surcharge alone runs from $81.20 to $487.00 per month depending on income tier. Combined with Part D surcharges, which range from $14.50 to $91.00 per month in 2026, the very top bracket carries a total IRMAA hit of $578 per month. Orman’s headline number remains accurate as a combined figure; it just arrives by a different route than it did four years ago.

If you have never heard of IRMAA, you are not alone, and that is exactly the problem. A one-time income spike from selling a rental property, exercising stock options, or doing a large Roth conversion can quietly hand you a Medicare bill two years later that you never budgeted for. For a married couple where both spouses hit the top tier, that surcharge compounds across two Part B premiums plus two Part D adjustments.

The verdict: Orman is right, and most people learn this the hard way

Her advice is sound and remains underdiscussed. IRMAA is real, it is steep, and it punishes anyone who treats “income” as a single-year concept once they reach 65.

Here is how it works. Medicare Part B carries a standard premium that almost everyone pays. Once your modified adjusted gross income (MAGI) crosses certain thresholds, Social Security tacks on a surcharge tier above that base. In 2026, the surcharge kicks in at $109,000 MAGI for single filers and $218,000 for joint filers. Roughly 5.1 million Medicare beneficiaries, about 7% to 8% of all Part B enrollees, paid an IRMAA surcharge in 2025. Orman noted on her podcast that she and her wife KT were paying roughly $526 a month for Part B out of their Social Security check, because their income placed them in a higher bracket. Today, the total Part B premium at the upper tiers reaches as high as $689.90 per month, or $8,278.80 per year per person.

The trap is the lookback. IRMAA is based on your MAGI from two years prior, so your 2026 Medicare premium is determined by what appeared on your 2024 tax return. Most retirees do not realize that a single transaction in their 60s can echo into a Medicare bill years later.

The surcharge also operates as a cliff, not a marginal rate. One dollar over a threshold reprices every month of coverage for the entire year. A retiree with 2024 MAGI of exactly $109,000 pays the standard $202.90 monthly in 2026. A neighbor who reported $109,001 pays $284.10, an extra $974 for the year per person, and nearly $2,000 for a couple where both spouses are enrolled. At the top bracket, the annual Part B cost reaches $8,278.80 per person before any Part D adjustment is added.

One trap that surprises even financially sophisticated retirees: tax-exempt municipal bond interest counts in full toward MAGI for IRMAA purposes. Retirees who hold municipal bonds to reduce their federal income tax bill often discover that the same interest raises their Medicare premiums, because IRMAA operates on a broader definition of income than ordinary taxable income.

Picture a 65-year-old couple living on $90,000 of pension and Social Security income. Comfortable, well below any IRMAA tier. In 2024 they sell a rental property and book a $250,000 gain. Their MAGI balloons. Two years later, Social Security looks back at that return and slots each spouse into a high IRMAA bracket. At the top tier, the combined Part B and Part D surcharges for two people can exceed $1,100 a month, before any plan premiums.

The kicker: the surcharge applies for the entire calendar year, not just the month the transaction occurred. One event, one full year of elevated premiums, two years after the fact. And for those hovering near the highest income tier, the fifth and top IRMAA bracket is currently frozen and will not be indexed for inflation until at least 2028, meaning the ceiling does not rise with cost-of-living increases the way lower tiers do.

The variable that flips the math: was it a one-time event?

This is where Orman gave listeners the lever most do not know exists. If you experienced what she called a “life changing event,” you can file Form SSA-44 and request that Social Security recalculate your IRMAA using your current income rather than the two-year-old return.

The list of qualifying events is narrower than people assume. Marriage, divorce, death of a spouse, work stoppage, work reduction, and loss of pension income are among them. A capital gain from selling property does not, by itself, qualify, but the associated event (retiring or stopping work in the same year) often does.

Run both scenarios. Scenario A: you sell the property the same year you retire and stop earning a paycheck. File SSA-44 citing work stoppage, and you may exit the elevated surcharge after one year instead of carrying it into a second. Scenario B: you sell the property while still working full-time. No qualifying event means no relief, and you absorb the full IRMAA hit. The same transaction, a very different Medicare bill, decided entirely by whether you can attach it to a life event Social Security recognizes.

What to do this week

1. Pull your most recent tax return and locate your MAGI. If you are within $20,000 of any IRMAA threshold and you are 63 or older, every dollar of additional income now carries a Medicare cost attached to it. If you hold municipal bonds in a taxable account, add that interest back in when estimating your MAGI exposure.
2. Before any large taxable event (Roth conversion, property sale, RMD, stock option exercise), model the two-year Medicare premium impact. Spreading a Roth conversion over three years instead of one can keep you in a lower tier and save thousands.
3. If you already had a one-time income spike tied to retirement, marriage, divorce, or loss of pension income, download Form SSA-44 and file it promptly. Social Security will not make this adjustment on your behalf.
4. Check the current year’s IRMAA brackets at SSA.gov before December. The first four tiers adjust with inflation each year, and a modest bracket change can save or cost a retiree four figures annually. Note that the top bracket is frozen through at least 2028, so income near that ceiling carries no bracket-drift relief.

Orman’s point lands because IRMAA is the rare retirement cost you can actually plan around, provided you know it exists. The two-year lookback gives you a window to manage income deliberately rather than discover the bill after the fact.

Editor’s note: This revision adds the 5.1 million beneficiary count for Part B IRMAA payers in 2025, the top-bracket annual cost of $8,278.80 per person, the municipal bond MAGI trap, and the freeze on the top IRMAA bracket through at least 2028. The 2026 Part B standard premium increase from $185.00 to $202.90 (a $17.90 jump) is also noted with the Federal Register as source.

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