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Medicare Late Enrollment Penalties

Missing your Initial Enrollment Period can be costly.

You have many decisions to make when you first become eligible for Medicare. It’s important to know the consequences of your choices.

Medicare Part A, Part B and Part D may charge premium penalties if you miss your initial enrollment dates, unless you qualify for a Special Enrollment Period Specific times when people who qualify due to special circumstances may enroll in Medicare outside their Initial Enrollment Period or the General Enrollment Period. Usually, you don’t pay a late enrollment penalty if you sign up during a Special Enrollment Period. .

Part A premium penalty

Part A is premium free if you or your spouse worked and paid taxes for at least 10 years.

If you have to pay a premium, the penalty for late enrollment is 10%.

You would pay the penalty for twice the number of years you delay enrollment. If you wait two years, for example, you would pay the additional 10% for four years (2 x 2 years). The penalty applies no matter how long you delay Part A enrollment.

Part B premium penalty

The penalty for late enrollment in Part B is an additional 10% for every 12-month period that you delay it.

Say your Initial Enrollment Period ended September 30, 2010, for example. You enroll in Part B during the General Enrollment Period in March 2013. Your penalty would be 20% (2 x 10%) of the Part B premium. You waited 30 months to sign up, but that included only two full 12-month periods.

In most cases, you have to pay the penalty every month for as long as you have Part B. If you’re under 65 and disabled, any Part B penalty ends once you turn 65.

Part D premium penalty

The penalty for late enrollment in a Part D plan is 1% of the average Part D premium for each month you delay enrollment. You pay the penalty for as long as you’re enrolled in a Medicare Part D plan.

You may delay enrolling in Medicare Part D without penalty if you qualify for Extra Help A Medicare program that helps people with limited income and resources pay for Medicare prescription drug plan costs, such as premiums, deductibles and coinsurance. or have creditable coverage. If it’s been more than 63 days since you’ve had creditable coverage Prescription drug coverage from a health plan other than a Medicare Part D standalone plan or a Medicare Advantage plan that includes prescription drug coverage and that meets certain Medicare standards. , then the penalty may apply.