Medicare Late Enrollment Penalties: Costs and Who Owes Them
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If you don’t sign up for Medicare during the initial enrollment period, you could start accruing potentially expensive and long-lasting penalties when you finally enroll. In some cases, these penalties are permanent and continue for as long as you’re receiving Medicare benefits.
The different parts of Medicare all have their own rules for when you’re subject to a penalty, how much the penalty will cost and how long you have to pay it.
Here’s what you need to know about the late enrollment penalties for Medicare Part A, Part B and Part D.
Medicare Part A late enrollment penalty
Most people don’t pay premiums for Medicare Part A, so they never need to worry about late enrollment penalties. However, those who don’t qualify for premium-free Part A are subject to penalties if they sign up late.
If you have to pay premiums for Medicare Part A and you didn’t sign up during your initial enrollment period, you’ll pay a penalty. The penalty adds an extra 10% to the monthly premium for Part A ($506 per month in 2023), and it lasts for twice the number of full years you went without signing up.
For example, if you went without signing up for Medicare Part A for two years, you would owe the extra penalty amount for four years. In 2023, the penalty would add more than $50 to your bill each month. In later years, the penalty could go up or down along with the Part A premium.
Medicare Part A penalty calculator
Medicare Part B late enrollment penalty
If you don’t sign up for Medicare Part B during your initial enrollment period, you’ll have to pay extra when you do sign up, unless you qualify for a special enrollment period.
The Medicare Part B late enrollment penalty adds 10% to your Medicare Part B premium for each full year that you could have signed up for Part B, but didn’t. The penalty is permanent: You’ll pay the extra amount for as long as you have Medicare Part B.
Medicare Part B penalty calculator
Medicare Part D late enrollment penalty
If you go too long without Medicare Part D prescription drug coverage or other prescription drug coverage that’s at least as good after your initial enrollment period ends, you’ll generally have permanent penalties added to your Medicare Part D premium once you sign up.
The Medicare Part D late enrollment penalty adds 1% of the national base beneficiary premium ($32.74 per month in 2023) to your Medicare Part D premium for each full month you went without qualifying prescription drug coverage.
For example, if you went without qualifying coverage for 24 months, your penalty would be 24% of the national base beneficiary premium. For 2023, 24% of $32.74 would work out to an extra $7.90 every month (rounded to the nearest 10 cents).