What is “late enrollment” for Medicare Insurance? In this instance, “late” means that you missed your Medicare Initial Enrollment Period. Your Initial Enrollment Period, or IEP, is usually a seven-month span that provides you with the opportunity to enroll in Medicare without facing any late penalties. It begins three months before the month you turn 65, includes your birthday month and continues through the next three months after your birthday month.
Late Enrollment Penalties for Part B
Many individuals are automatically enrolled in Medicare Part A and Part B when they turn 65. You may choose to defer enrollment in Medicare Part B, though. Suppose you decide not to enroll in Medicare Part B when you are eligible initially. In that case, you are at risk of being subjected to a 10% increase in your Medicare Part B monthly premium for each 12-month period you were eligible for Medicare Part B but were not enrolled in the plan. The longer you are not enrolled in Medicare Part B, the higher your penalty applied to your premium may be.
If you miss your Initial Enrollment Period, there is one other circumstance that will allow you to enroll in Medicare Part B and avoid facing late penalties: a Special Enrollment Period.
Late Enrollment Penalties for Part D
If you are subjected to the late enrollment penalty for Medicare Part D, also known as prescription coverage, the penalty is permanent, just as it is with Part B. Once your IEP ends and you continue for 63 or more days without Medicare Part D coverage or other creditable drug coverage, then you will more than likely be subjected to the late enrollment penalty. The amount you are charged for the penalty is determined by multiplying 1% of the “national base beneficiary premium” times the number of full, uncovered months that you were not enrolled in Medicare Part D coverage or other creditable drug coverage. The national base beneficiary premium was $33.06 as of 2021. The penalty is then rounded to the nearest $0.10 and added to your monthly premium.
The SEP rule for Medicare Part D differs from the SEP applied to Medicare Part A and Part B. Once you lose coverage from your employer, you have 63 days to enroll in Medicare Part D without facing any late penalties. This timeframe is so short because Medicare rules dictate that you cannot go more than 63 days without Medicare Part D or creditable drug coverage while enrolled in Medicare Part A and Part B.
Tips To Avoid Part B And Part D Late Penalties
- Ensure your employer coverage is deemed creditable and request notice of creditable coverage from your employer.
- Be aware of your Special Enrollment Period dates for all parts of Medicare, especially Medicare Part B and Part D.
- Educate yourself about your Medicare options before your SEP begins.
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At Carolina Senior Benefits, we care about you getting the coverage you deserve and at the right time. For more information about avoiding late enrollment penalties, give us a call today!
