Part B Late Penalties Could Cost You Big TimePosted by Medicare Made Clear
You’re turning 65 and it’s time to sign up for Medicare. Depending on your situation, there are parts of Medicare you may not need right away, like Part B if you are still working and have employer-sponsored coverage. However, if you don’t figure out your personal needs and miss your Initial Enrollment Period, you may have to pay penalties for as long as you have Medicare.
Why does the federal government require you to participate or face a penalty for late enrollment? Susan Morisato, President of Insurance Solutions, UnitedHealthcare says it’s the same reason you have car insurance. “You can’t buy car insurance after you have a crash,” says Morisato. “Just like home and auto insurance, the whole concept is risk, and with Medicare, it’s a risk we all share.”
The Initial Enrollment Period for Medicare Part A and Part B runs for seven months. It includes the three months before your 65th birthday month, your birthday month, and the three months after your birthday month.
If you miss your Medicare Part A enrollment, you may have to pay a Part A late-enrollment penalty every month you have Medicare. Medicare Part A is hospital insurance. It helps pay for medically necessary care you receive as an inpatient.
Medicare Part B helps pay for doctor visits and medical care you receive as an outpatient.
If you miss your Medicare Part B enrollment and you don’t have an eligible reason to postpone enrollment, you may have to pay 10 percent for each full 12-month period you could have been enrolled in Part B. For example, if you didn’t sign up for Part B until 30 months after you should have, you’ll pay a 20 percent penalty. That’s 10 percent for each 12 full months you were late. The penalty is a permanent increase to your premium.
If you need help understanding your plan choices, contact your local State Health Insurance Assistance Program (SHIP). SHIP is a state-based program that offers local one-on-one counseling to Medicare beneficiaries on a wide range of Medicare, Medicaid and Medigap matters.
For more information, explore MedicareMadeClear.com or contact the Medicare helpline 24 hours a day, seven days a week at 1-800-MEDICARE (1-800-633-4227), TTY 1-877-486-2048.
Avoid Late Medicare Enrollment Penalties: Knowing when to enroll in Medicare is just as important as the plans you choose — MedicareMadeClear.com
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Medicare & You: Get the official U.S. government Medicare handbook.