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Can You Be Penalized for Not Enrolling in Medicare, Even if You're Not Entitled to It?

Q. My husband hadn’t worked long enough to qualify for Medicare when he reached 65, so he waited to enroll on my work record when I turned 65. Now he must pay a Part B late penalty. Can you really be penalized for not joining Medicare when you weren’t even eligible for it?

A. Strangely enough, yes — in certain circumstances. It can happen under a little-known rule that could catch many people unaware.

The Social Security Administration, which administers Medicare enrollment, explains that someone who doesn’t qualify for premium-free Medicare Part A is nevertheless eligible for Part B at age 65 if he or she lives in the United States and is either a U.S. citizen or a legal immigrant (green card holder) who has lived here for at least five years. They describe this as an “alternate requirement” for Medicare eligibility.

In other words, your husband wasn’t entitled to receive Part A (hospital insurance) without having to pay premiums because he hadn’t paid Medicare payroll taxes long enough. Even so, he was still eligible to enroll in Part B (outpatient insurance, which always requires premiums) alone because he met the above conditions. So he could have signed up for Part B during his seven-month initial enrollment period, which ran from three months before the month of his 65th birthday to three months after it. Trouble was, he didn’t know it — and not being aware of the rules is not a defense for avoiding a late penalty.

This situation would turn out differently if you had paid enough Medicare payroll taxes to qualify for premium-free Part A.  In that case, your husband would have been eligible for full Medicare benefits (without paying Part A premiums) on your work record as soon as you turned 62. 

It would also be different if either you or your husband has been working for an employer that provides health insurance for both of you. In that case, even if either of you are well past 65 when you retire or your employer coverage comes to an end, you both would then be entitled to a special enrollment period of eight months to enroll in Part B without incurring a late penalty. For more details on this topic, see “Medicare When Working Beyond 65.”

If you’re unsure whether to enroll in Medicare Parts A or B, or when it’s best for you to do so, call the Social Security Administration at 1-800-772-1213 to check out the rules according to your own circumstances.

Patricia Barry is a senior editor at the AARP Bulletin.

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