Medicare Late Enrollment Penalties: What Parts A, B and D Add to Your Premium

How a late penalty works

Medicare says it is important to sign up during your Initial Enrollment Period, unless you have other coverage that is similar in value to Medicare, such as coverage from an employer. If you do not, you may have to pay a late enrollment penalty.

The penalty is added to your monthly premium. It is not a one-time late fee. It usually lasts as long as you have that type of coverage, which for most people means for life, and it goes up the longer you wait, because it is based on how long you go without coverage similar to Medicare.

Part B: 10% for each full year

You pay an extra 10% of the standard Part B premium for each full 12-month period you could have signed up for Part B but did not. If you waited two full years, or 24 months, and did not qualify for a Special Enrollment Period, you pay a 20% penalty on top of the standard premium.

You may also pay a higher premium depending on your income. Generally you do not pay a Part B penalty if you qualify for a Special Enrollment Period or you enroll in a Medicare Savings Program.

Medicare.gov shows the current standard Part B premium, and a worked example, on its late enrollment penalty page.

Part D: 1% for each month

You pay an extra 1% for each month, or 12% a year, if you do not join a Medicare drug plan when you first get Medicare, or if you go 63 days or more without creditable drug coverage. Creditable drug coverage is coverage similar in value to Part D.

The penalty amount comes from the national base beneficiary premium, which changes each year. Medicare.gov gives this example: someone who waited 14 months to join a drug plan and had no creditable coverage pays a 14% penalty in addition to the plan's monthly premium. The penalty is added for as long as you have Medicare drug coverage, even if you switch plans.

Generally you do not pay a Part D penalty if you have creditable drug coverage or you qualify for Extra Help.

Part A: only if you have to buy it

Many people get Part A without a premium. Some have to buy it because they do not qualify for premium-free Part A. If you have to buy Part A and do not buy it when you are first eligible, your monthly premium may go up 10%, and you pay the higher amount for twice the number of years you did not sign up. For example, two years of waiting means four years of the higher premium.

Usually you do not pay a Part A penalty if you meet certain conditions that let you sign up during a Special Enrollment Period.

Ways to avoid a penalty

Sign up during your Initial Enrollment Period. If you have employer coverage that is similar in value to Medicare, ask whether it counts as creditable coverage before you delay. Check whether you qualify for a Special Enrollment Period. If your income is limited, ask about a Medicare Savings Program or Extra Help.

Our guide to Medicare enrollment periods lists the dates.

Common questions

Is a Medicare late enrollment penalty a one-time fee?

No. It is added to your monthly premium and usually lasts as long as you have that coverage.

Can a Special Enrollment Period help me avoid the Part B penalty?

Generally yes. You usually do not pay a Part B penalty if you qualify for a Special Enrollment Period or enroll in a Medicare Savings Program.

Does the Part D penalty go away if I change plans?

No. The penalty is added for as long as you have Medicare drug coverage, even if you switch plans.