I have a relative who was recently concerned that his Medicare premiums seemed to have jumped by about 50%. It turned out that last year his income had exceeded a certain number which made him subject to surcharges.
I support progressive taxation brackets. (Although conservatives [selectively] love Adam Smith and hate progressive taxation, in fact Adam Smith said it was reasonable for the rich to pay a higher tax rate than others pay.) In that sense, I can't entirely oppose a higher premium rate based on higher income. Especially, if it were the only way we could afford medical care for poorer Medicare patients, it would seem important to ask more from more affluent Medicare recipients.
However, this is another example of a double standard or biased inconsistency in our public policy.
Rich people who may or may not have ever worked have special low tax rates on non-work types of income such as capital gains and "qualified dividends." Hedge fund big wigs have a kind of income analogous to merit bonuses called "carried interest" on which they have a special low tax rate. Even if a rich person pays the same or higher effective income tax rate as a person with a regular job and average income, the rich guy doesn't have to add Social Security and Medicare taxes on top of that (or if the rich person does work and pay FICA, it's only on part of his income). That's why a few years ago Warren Buffet found his effective tax rate was lower than that of his secretary.
Even if we had only one set of tax brackets for wages, capital gains, etc., there would still be an issue. Why is it that there are several tax brackets between an income of $4,000 and an income of $400,000, but there are no higher brackets for $4 million or $40 million?
People who live in affluent suburbs may pay more dollars in real estate taxes than people in less affluent places - because they live in bigger houses with bigger yards and bigger price tags. But the real estate tax RATE is often lower than in cities or less affluent towns.
There are various ways in which our governments have arranged to let people with higher incomes have lower tax rates than others pay. And yet the government chooses to have Medicare recipients above a certain income pay higher premiums. Why? In the final analysis, it's because they worked for a living. The idle rich didn't work and pay into Social Security, and don't receive Medicare when they reach 65. The truly rich don't pay Medicare premiums, so these surcharges don't affect them. Our government is willing to ask people with higher incomes to pay more, as long as it's done in a way that billionaires aren't being asked to pay more.
To the extent we view Medicare and its premiums as "insurance," it may be fair to ask whether private insurance companies impose surcharges for higher incomes when selling home, life or liability insurance.
Currently, we know that the wealthy and their politicians are trying to cut Social Security, Medicare and Medicaid. But the bias I'm discussing here isn't limited to those programs. Those are "earned benefits" but there is something which might be considered to be earned in an even greater way. We've seen scandals under both Pres. George W. Bush and Pres. Obama regarding the medical care for veterans. There is no number of dollars which is considered to be too much for the budgets of the Pentagon, NSA and other spy agencies. But the people who are actually sent to the battlefield are rarely rich. They are people from modest incomes, so when they return with war injuries or war trauma their medical treatment is not the priority it should be.
If you work in the factory, office or battlefield, the government isn't so concerned about your welfare as it is about getting your money. If you've never worked in any of the above, the government is more concerned about your welfare than it is about getting your money.