Medicare Late Enrollment Penalty

If there’s something you do not want to be late for, it’s Medicare enrollment. Being late for Medicare enrollment can have long-lasting and expensive consequences. It can cost you more on your monthly payments for years to come. That’s why we’re going to explore what those late-enrollment penalties look like and how you can avoid them.

How do I get late enrollment penalties?

Late enrollment penalties are used to encourage people to enroll in Medicare when first eligible. Medicare penalties are fees that you’re charged with if you do not sign up for Medicare when you’re eligible. For most people, that is the seven-month period around your 65th birthday. Even if you’re healthy and don’t feel like you need to sign up, it is important to sign up for Medicare on time to avoid penalties.

What is the Medicare Part A penalty?

Many people are automatically eligible for Medicare Part A without having to pay any premiums. However, if you didn’t meet the work hour requirement during your lifetime to have Part A paid through payroll taxes, you can still purchase Medicare Part A. In that scenario, you will have to pay a monthly premium.

If you’re not automatically enrolled and don’t sign up for Medicare Part A during your initial enrollment period, you’ll have a late enrollment penalty when you do sign up.

The late enrollment penalty amount is 10% of your monthly premium. You’ll have to pay this additional cost each month for twice the number of years you were eligible for Medicare Part A but didn’t sign up. So, if you waited two years post-eligibility to sign up, you’ll pay the penalty amount each month for four years.

What is the Medicare Part B penalty?

Part B penalties are applied for delayed enrollment in Medicare Part B without having other credible coverage. If you don’t get Part B when you’re first eligible, you will be penalized when you do sign up.

Your monthly premium may go up 10% for each year you could’ve had Part B. In most cases, you’ll have to pay this penalty for as long as you have Part B. For more information, please refer to the Medicare website.

What is the Medicare Part D penalty?

Medicare Part D drug plans also have late-enrollment penalties. You can enroll in Medicare Part D without a late enrollment penalty during the three-month period that begins when your Medicare Parts A and B become active. If you wait, a late enrollment penalty for Medicare Part D will be added to your monthly premium.

The fee is 1% of the average monthly prescription premium cost, multiplied by the number of months you were late enrolling. The fee is permanent, and you will have to pay extra for as long as you have Medicare Part D.

Do Medicare Supplement plans have late enrollment penalties?

Late enrollment for Medicare Supplement plans doesn’t have a late penalty. But if you want to get the best rates, you’ll need to enroll during your first Open Enrollment Period. It starts when you turn 65 and lasts for six months from that date. If you miss open enrollment, you may pay a higher premium, face medical underwriting or be denied coverage.

In conclusion: What can I do to avoid late enrollment penalties?

The best way to avoid penalties is to sign up on time. If you are still working and have insurance through a qualified workplace, you won’t have to sign up for Medicare until you retire.

If you are approaching Medicare enrollment age and have questions, give PlanEnroll a call. Our licensed insurance agents are here to help you find coverage that fits your needs and your budget.

PlanEnroll is a brand operated by Integrity Marketing Group, LLC and used by its affiliated licensed insurance agencies that are certified to sell Medicare products. PlanEnroll is not endorsed by the Center for Medicare & Medicaid Services (CMS), the Department of Health and Human Services (DHHS), or any other government agency.