En español | Medicare Part B covers doctor's visits and tests, diagnostic screenings, durable medical equipment and other outpatient services. This coverage costs $164.90 a month in 2023 for most people.
Some people delay signing up for Part B if they have other coverage so they can avoid paying the monthly premiums. But if you don't sign up for Medicare Part B when you are first eligible and don't qualify for a special enrollment period, you may have to pay a late enrollment penalty.
The late enrollment penalty adds an extra 10 percent of the standard Part B premium for each 12-month period when you could have had Part B but didn’t, and it lasts for as long as you have Part B.
You generally need to sign up for Medicare parts A and B during your initial enrollment period, which begins three months before the month you turn age 65 and ends three months after your birthday month.
You may be able to delay enrolling in Medicare if you or your spouse is still working and you have health insurance through either of your employers. But after losing your job-based coverage, you have to sign up during a special enrollment period while you’re working or within eight months of losing your health insurance.
If you don’t sign up during your initial or special enrollment periods, you will face two consequences.
1. A short enrollment window. You’ll be restricted to signing up during a general enrollment period, which runs Jan. 1 to March 31 each year. In the past, coverage would not begin until July 1; however, starting in 2023 coverage begins the first of the month after the month you enroll.
2. A potential late penalty. Most people don’t pay a penalty for late enrollment in Medicare Part A, which covers hospitalization, because they or their spouse has paid Medicare taxes for at least 10 years and they qualify for premium-free Part A. But that won’t shield them from a Part B penalty if they could have signed up but didn’t.
For example, if you enroll in Part B 26 months late, you’ll have to pay a $32.98 late enrollment penalty every month in 2023, in addition to your $164.90 Part B premium. That’s 20 percent of $164.90 because the penalty is based on 12-month periods. Your monthly premium will be $197.90 in 2023 because the amount is rounded to the nearest 10 cents.
Since Part B premiums usually rise each year, your late enrollment penalty usually rises as well. The penalty lasts for as long as you have Medicare Part B, whether you have coverage through original Medicare or a Medicare Advantage plan. This is different from the Part A penalty, which lasts for a finite time.
If you should have signed up for Medicare at age 65, the penalty calculation is based on the time that elapsed between the end of your initial enrollment period and the end of the general enrollment period in which you finally sign up. If you delayed enrollment after age 65 because you were receiving health insurance through your or your spouse’s active employment, the penalty calculation is based on the time between the end of the employment — not the end of your special enrollment period eight months later — and the end of the general enrollment period when you finally sign up.
You don’t have to pay a penalty if you sign up for Medicare Part B within eight months of losing your job-based coverage. These are other exceptions.
Medicare can also establish special enrollment periods in other situations, such as allowing someone to enroll late because they were affected by a natural disaster.
Only health insurance coverage from your own or your spouse’s current employer counts for a special enrollment period to avoid the late enrollment penalty. Having retiree health benefits or COBRA extended coverage from a former employer after age 65 will not exempt you from Part B late penalties if you don’t meet your enrollment deadline.
But if you have prescription drug coverage from these or other sources that is considered to be at least as good as Medicare’s, that coverage may count as “creditable prescription drug coverage” to avoid the Part D late enrollment penalty.
Updated January 3, 2023
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