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They say what goes up must come down, but that rarely seems to be the case with health care costs. Here’s some good news: If you’re on Medicare, there are a couple of ways you might be able to buck the trend and keep more of your money.

We’re in the midst of the annual enrollment period, which runs from mid-October until Dec. 7. It’s your chance to see whether you can save some cash, and it’s less of a time commitment than you might think.

The annual enrollment period is for people who are already receiving Medicare. If you need to sign up for the first time, see our tips on applying for Medicare.

Here are two tips you can try:

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Tip 1: Take advantage of the annual enrollment period

You’re not required to do anything at all during the annual enrollment period – if you don’t, your current benefits will continue. But you might be missing an opportunity, and we’ve made it simple (and free) to find out by partnering with Medicare consultant Chapter Advisory. See our recent article on making changes to your Medicare coverage and consider scheduling an appointment to review your situation.

Any changes you make during this period will go into effect on Jan. 1, 2025. That’s also when new 2025 premiums will take effect.

Medicare premiums for 2025

As a refresher, here are the different types of premiums:

• Part A (Hospital Insurance): Most people don't pay a premium for Part A if they or their spouse paid Medicare taxes while working.��(If you do have to pay for Part A, the 2024 premium amount is either $278 or $505, depending on your work history – the 2025 amounts weren’t available at the time of this writing.)
• Part B (Medical Insurance): This amount can vary based on your income; higher-income beneficiaries may be subject to an Income-Related Monthly Adjustment Amount. More on that below.
• Part D (Prescription Drug Coverage): Part D premiums vary by plan. Like Part B, Part D premiums can also be subject to an IRMAA, depending on your income.
• Medicare Advantage (Part C): These plans are offered by private companies approved by Medicare, and you can select one of them in place of Original Medicare for parts A and B (and often D). Premiums vary depending on the plan and the services it covers, and they’re set by the insurer, not the government. If you have Medicare Advantage, your insurer should have sent you a notice in September letting you know the new prices for 2025.
• Medigap (also known as Medicare Supplement plans): You can add these to Original Medicare to cover additional types of costs. The cost varies by plan.

To know how much you’re set to pay for 2025, you’ll need to add together your premiums for Part B plus Part D plus any Medigap coverage, or Part B plus Part C if you have Medicare Advantage (and in either case you’ll also need to add Part A if you’re required to pay for it).

What you can do during the 2025 annual enrollment period

If it will save you money (while – very importantly – still meeting your coverage needs), you can make these changes by Dec. 7:

• Add Part D coverage. Medicare will also allow you to drop Part D, but we generally don’t recommend it because a gap in coverage could lead to future penalties.
• Change Part D coverage to another plan.
• Change from Original Medicare (and Medigap if you have it) to Medicare Advantage, or vice versa.
• Switch Medicare Advantage coverage to another plan.

Note that the rules for when and how you can change Medigap plans are complicated and depend on where you live; They’re not part of the annual enrollment period.

We highly recommend taking advantage of a consultation with Chapter Advisory before making any changes – it’s included in your relationship with us.

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Tip 2: See if you can appeal your IRMAA

As we said above, an IRMAA is an additional charge that higher-income beneficiaries pay on top of their standard Part B and Part D premiums. Note that, if you have grounds to do so, you can file an appeal to reduce your IRMAA at any time – it doesn’t have to be during annual enrollment. If you think you have grounds to appeal, do it as soon as possible after you receive the IRMAA determination letter. (Or, if you’re already paying an IRMAA, after you experience the life-changing event.)

Here’s how IRMAAs work:

What the Social Security Administration considers

An IRMAA is based on your modified adjusted gross income from two years ago. For example, your 2025 IRMAA will be based on your 2023 income.

Note that MAGI for IRMAA determinations is defined as your AGI plus any tax-exempt interest income.

If you’re subject to an IRMAA, you’ll receive a letter that lets you know your 2025 IRMAA. You’ll add it to the base premium to get your total costs.

Who has to pay it

In 2024, you’d be subject to IRMAA if your income was above $103,000 (individual) or $206,000 (married couple). Again, 2025 brackets weren’t available at the time of this writing.

When to appeal

If you’ve experienced a life-changing event that reduced your income significantly below the 2023 numbers the SSA is using, you can appeal your IRMAA determination.

Some common reasons for appeal are:

• Retirement or reduced work hours
• Divorce
• Death of a spouse
• Loss of an income stream, like a property or a pension

Note that you may have had a higher income for a reason that’s not considered a life-changing event. For example, if you had large one-time capital gains in 2023 (like from selling a house), that will not be considered grounds for appeal for 2025. You’ll simply have to pay higher expenses for one year.

How to appeal

File Form SSA-44 with the SSA and provide documentation of the event and your reduced income.

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Spend less on Medicare in 2025

Consider a free consultation with Chapter Advisory to see if you can get the coverage you need at a lower cost – your financial planner can help you set it up. And reach out to your planner if you have questions about applying for Medicare or appealing your IRMAA.