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What you’ll pay in penalties for enrolling late in Part A depends on a couple of factors, such as how long you’ve paid Medicare taxes and when you sign up.
Most people don’t have to pay premiums for Medicare Part A, which covers inpatient stays in hospitals and skilled nursing facilities, some home health services and end-of-life hospice care.
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That’s because you or your spouse earned at least 40 credits through paying Medicare payroll taxes at work, essentially 10 years of work. This makes you entitled to Part A benefits without having to pay premiums for them, and you won’t have to pay Part A late penalties even if you sign up later than you should.
If you haven’t paid Medicare taxes for 40 quarters and your spouse doesn’t have 40 quarters either, you will have to pay premiums to receive Medicare Part A coverage. In 2023 and 2024, if you or your spouse paid Medicare taxes for 30 to 39 quarters, you’ll pay $278 a month for Part A. If you or your spouse paid Medicare taxes for fewer than 30 quarters, you’ll pay $506 a month for Part A in 2023 and $505 a month in 2024.
If you aren’t eligible for premium-free Part A, you may have to pay a late enrollment penalty, except in certain circumstances. That’s why it’s important to sign up for Medicare when you are first eligible.
How is the Part A late enrollment penalty calculated?
If you do have to pay premiums for Part A, the late enrollment penalty is 10 percent of either $278 or $505 in 2024, added to that monthly premium. Unlike Part B penalties, it doesn’t last forever.
Instead, you will pay Part A penalties for twice the number of years that you could have paid premiums for Part A but didn’t. For example, if you delayed enrollment for three years, you would pay penalties for six years.
So if you worked for fewer than 7.5 years in all or 30 quarters, you would have to pay more than $50 extra a month, 10 percent of $505, as your premium penalty in 2024. If you delayed your enrollment for three years and weren’t eligible for a special enrollment period, then you would have to pay the penalty for six years. Because Part A premiums usually change each year, your penalty will generally change each year, too.
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Monthly premiums, other out-of-pocket expenses can add up