A $65,000 Pension Plus Social Security Can Quietly Push You Into a Medicare Surcharge

The Income-Related Monthly Adjustment Amount, known as IRMAA, is the Medicare surcharge that raises Part B and Part D premiums for higher-income retirees. It applies to roughly 8% of people with Medicare Part B and a similar share of Part D enrollees. The thresholds are set at income levels that a federal or state pension, combined with a full Social Security benefit, can quietly reach, especially after a few years of cost-of-living adjustments.

The 2026 thresholds and what they cost

For 2026, the first IRMAA bracket kicks in once your modified adjusted gross income tops $109,000 for individuals or $218,000 for married couples. Since the standard Part B premium is $202.90 a month, crossing that line adds an extra $81.20 surcharge to your monthly bill. That brings your total to $284.10.

But wait, there is more. Medicare Part D adds another $14.50 on top of that. All in, if you are a single filer who just barely edges over that $109,000 threshold, you are looking at an extra $96 a month, or about $1,152 more per year, on top of whatever your actual prescription plan costs.

The brackets function as cliffs. A single dollar of MAGI over $109,000 moves a filer into the next tier and applies the full surcharge for the year. The next step up arrives above $137,000 for singles, and $274,000 for joint filers, where the Part B IRMAA jumps to $202.90, and the Part D IRMAA rises to $37.50.

How a pension and Social Security get there

The arithmetic is closer than many retirees expect. A career federal employee, state teacher, or utility worker with a defined-benefit pension of 70,000 to 80,000 dollars a year sits within reach of the first bracket once Social Security is layered on. The Bureau of Economic Analysis reports per capita disposable personal income of approximately $68,391 in the first quarter of 2026, and aggregate Social Security payments have grown significantly due to cost-of-living adjustments.

A retiree with $48,000 dollars in annual Social Security and a $65,000-dollar pension is just under the single-filer threshold. After future cost-of-living adjustments and any pension escalator, the same household crosses 109,000 dollars without changing investments, withdrawal patterns, or work status.

That growth is reflected in the annual COLA. The 2026 Social Security COLA is 2.8%, set by the year-over-year change in the third-quarter CPI-W average. The index stood at 328.829 in May 2026, up from 315.945 a year earlier, keeping upward pressure on the next adjustment. A retiree with $48,000 in annual Social Security and a $65,000 pension is just under the single-filer threshold. After two more 2.8% COLAs and any pension escalator, the same household crosses $109,000 without changing investments, withdrawal patterns, or work status.

The two-year look-back

IRMAA uses MAGI from the tax return filed two years earlier. The 2026 surcharge is based on 2024 income. That delay means a one-time event, a Roth conversion, a property sale, or a large required minimum distribution can raise premiums two years later even if income has since returned to normal. Form SSA-44 allows an appeal after a qualifying life-changing event, such as retirement, divorce, or the death of a spouse, but routine COLA-driven income growth does not qualify.

What the data points to

The Consumer Expenditure Survey puts average annual household spending at $ 78,535 for 2024, with healthcare accounting for a rising share of that figure among older households. The personal savings rate reached 3.9 percent in the first quarter of 2026, leaving less cushion for unplanned premium increases. Three planning considerations follow from the bracket structure:

1. MAGI tracking in the year before Medicare enrollment and in each subsequent year matters, since the 2024 figure drives 2026 premiums and the 2025 figure drives 2027.
2. The timing of Roth conversions, capital gains, and large IRA withdrawals determines whether the spike falls in a year where crossing a bracket is acceptable, rather than spreading the cost across consecutive years.
3. An SSA-44 filing is available after a qualifying life-changing event, and the bracket cliffs are typically reviewed each fall when CMS publishes the next year’s thresholds.

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