Join AARP today. Get instant access to discounts, programs, services and the information you need to benefit every area of your life.
by Patricia Barry, AARP Bulletin, March 31, 2008
Q. What happens if I don’t sign up for Medicare when I’m 65?
A. Joining Medicare is voluntary. But there may be consequences—in the form of a late penalty—if you don’t enroll at the “right” time, depending on your circumstances.
Part A (hospital insurance): There is no penalty for delaying to enroll in Part A if you qualify for it automatically on the basis of you or your spouse’s work record. But in most circumstances, there’s no reason not to sign up as soon as you’re eligible. It costs nothing to enroll and you don’t pay monthly premiums—you or your spouse has already paid to participate in Part A through payroll taxes at work. Also, having your name in the system makes you eligible for benefits such as prescription drug insurance (Part D) if you need it. (However, if you have employer insurance in the form of a high deductible health plan plus a Health Savings Account, be aware that under current law, you cannot use an HSA if you’re enrolled in, or have even applied for, Medicare. You need to carefully consider your rights and options.)
Part B (doctors and outpatient services): If you delay signing up for Part B beyond the time when you’re first eligible for it, you could incur a late penalty. (The exception is if you’re still working and have “primary” health insurance from your employer.) The penalty permanently adds to the cost of your Part B premiums—at a rate of 10 percent for each year that you could have been in Part B but were not. For example, if you delay five years, you’ll pay an extra 50 percent of the cost of that year’s premium. The penalty amount grows larger over time because it’s pegged to the cost of each year’s Part B premiums, which generally rise every year.
Part D (prescription drugs): If you delay signing up for Part D beyond the time you’re first eligible for it, you could incur a late penalty that adds to your Part D premiums—12 percent for each year that you could have had Part D but did not. There are exceptions. You would not risk a late penalty for as long as you have other insurance for prescription drugs (such as coverage under an employer health plan or retiree benefits) that is considered at least as good as Part D. If this is the case, you won’t need Part D unless you lose or drop such coverage. Otherwise, to avoid a penalty, you need to sign up for Part D at the same time as for Part B.
Patricia Barry is a senior editor at the AARP Bulletin.
Please leave your comment below.
You must be logged in to leave a comment.
WW will help you build a customized weight loss plan
25% off the first healthy meal delivery of $99+.
Give or get help during the Coronavirus pandemic
AARP members receive exclusive member benefits & affect social change.
You are leaving AARP.org and going to the website of our trusted provider. The provider’s terms, conditions and policies apply. Please return to AARP.org to learn more about other benefits.
Your email address is now confirmed.
Manage your email preferences and tell us which topics interest you so that we can prioritize the information you receive.
Explore all that AARP has to offer.
In the next 24 hours, you will receive an email to confirm your subscription to receive emails
related to AARP volunteering. Once you confirm that subscription, you will regularly
receive communications related to AARP volunteering. In the meantime, please feel free
to search for ways to make a difference in your community at