Enrollment and Penalties

Who can Enroll in Medicare?

To be eligible to enroll in Medicare, you must be a US Citizen or be a legal resident who has resided in the US for five continuous years, including the five years just prior to enrolling.

You also must meet one of the following criteria: Age 65 or older, be younger than 65 with a qualifying disability, or have a diagnosis of end stage Renal disease or ALS.

When can I enroll in Medicare?

Around when you turn 65, (or receive your 25th disability check), you will have what is known as your Initial Enrollment Period (IEP). This includes the month you turn 65, three months before, and three months after. If you are receiving Social Security or Railroad Retirement Board Benefits, you will be automatically enrolled. You will still have an IEP when you can make additional coverage decisions. If you are not receiving these benefits, you may or may not be contacted by Medicare, so you should mark these dates to enroll yourself in Medicare. You may have a Special Enrollment Period (SEP) if you or your spouse is working past 65 and you have creditable health coverage.

Additional Coverages

At Passage Insurance, we help guide our clients to keep them covered to safeguard from financial exposure involved with the gaps in Medicare through providing Medicare Advantage or Medicare Supplement Plans. It is important to note, timing is of the essence in making these critical decisions to also avoid paying more for the same coverages by avoiding late penalties assessed by Medicare. Also, if you are over age 65, and gone without creditable coverage, set up a call with us today so we can stop accumulating more penalties for your medical financial future!

Avoid penalties now. Procrastination may cost you.

Of course, you can delay a decision in Medicare options; however, if you are approaching 65, it is important to know the consequences of delaying such a significant decision as your own healthcare as there are penalties assessed for enrolling later.

Here are the penalties involved in delaying Medicare. Please note, this is directly from Medicare.gov:

Avoid late enrollment penalties!

Part A late enrollment penalty

Some people have to buy Part A because they don’t qualify for premium-free Part A. If you have to buy Part A, and you don’t buy it when you’re first eligible for Medicare, your monthly premium may go up 10%.

You’ll have to pay the penalty for twice the number of years you didn’t sign up.

Example:

If you were eligible for Part A for 2 years but didn’t sign up, you’ll have to pay the higher premium for 4 years. Usually, you don’t have to pay a penalty if you meet certain conditions that allow you to sign up for Part A during a Special Enrollment Period. Find out if you’re eligible for a Special Enrollment Period.

Part B late enrollment penalty

Generally, you won’t have to pay a Part B penalty if you qualify for a Special Enrollment Period.

You’ll pay an extra 10% for each year you could have signed up for Part B, but didn’t.

You may also pay a higher premium depending on your income.

Example:
If you waited 2 full years (24 months) to sign up for Part B and didn’t qualify for a Special Enrollment Period, you’ll have to pay a 20% late enrollment penalty (10% for each full 12-month period that you could have signed up), plus the standard Part B monthly premium ($170.10 in 2022) ($164.90 in 2023).

$170.10 (2022 Part B standard premium) ($164.90 in 2023)
+ $34.00 (20% [of $170.10] late enrollment penalty) ($32.98 in 2023)

$204.10 will be your Part B monthly premium for 2022. ($197.90 in 2023). This amount is rounded to the nearest $.10 and includes the late enrollment penalty.

Part D late enrollment penalty

Generally, you won’t have to pay a Part D penalty if:

You have creditable drug coverage (coverage that’s similar in value to Part D), or;

You qualify for Extra Help.

You’ll pay an extra 1% for each month (that’s 12% a year) if you:

Don’t join a Medicare drug plan when you first get Medicare, or;

Go 63 days or more without creditable drug coverage.

You may also pay a higher premium depending on your income.

Example:
If you waited 14 months after you were eligible for Medicare to join a Medicare drug plan, and you didn’t have creditable drug coverage, you’ll have to pay a 14% late enrollment penalty in addition to your monthly plan premium.

The penalty amount comes from the “national base beneficiary premium” ($33.37 in 2022) ($32.74 in 2023).

The national base beneficiary premium changes each year, so your penalty amount may also change each year. This monthly penalty is added for as long as you have Medicare drug coverage, even if you switch plans.