Medicare Late Enrollment Penalties: How Much Extra You'll Pay and How to Avoid Them

Missing your Medicare enrollment deadline can cost you hundreds or thousands of dollars over your lifetime. Late enrollment penalties apply to Medicare Part B and Part D. These penalties are added to your monthly premium and last for years or even permanently.

Understanding how these penalties work can help you avoid them. This guide explains how much late enrollment penalties cost, how they are calculated, and what you can do to prevent them.

What Is a Medicare Late Enrollment Penalty?

A late enrollment penalty is an extra charge added to your Medicare premium if you do not sign up when you are first eligible. Medicare penalizes late enrollment to encourage people to sign up on time and keep the insurance pool balanced.

The penalties apply only to Part B and Part D. Most people do not pay a penalty for Part A because they receive it premium-free. If you do have to pay for Part A, a penalty may apply in rare cases.

Medicare Part B Late Enrollment Penalty

How the Part B Penalty Is Calculated

The Part B penalty equals 10% of the standard Part B premium for each full 12-month period you were eligible but did not enroll. In 2026, the standard Part B premium is $185 per month. For each year you delay, you add $18.50 to your monthly premium.

For example, if you wait two years past your Initial Enrollment Period, your penalty is 20%. You would pay $222 per month instead of $185. That extra $37 per month equals $444 per year.

How Long the Part B Penalty Lasts

The Part B late enrollment penalty is permanent. You will pay it every month for as long as you have Part B coverage. The penalty amount can change each year as the standard premium changes, but the percentage stays the same.

If the standard premium increases in future years, your penalty increases too. This means the dollar amount you pay will grow over time, even though the percentage stays fixed.

Medicare Part D Late Enrollment Penalty

How the Part D Penalty Is Calculated

The Part D penalty is 1% of the national base beneficiary premium for each full month you were eligible but did not have creditable prescription drug coverage. The national base premium changes each year. For 2026, it is approximately $34.70.

If you go 18 months without coverage, your penalty is 18% of the base premium. That equals about $6.25 per month added to your Part D plan premium. The penalty is rounded to the nearest $0.10 and added to your monthly bill.

How Long the Part D Penalty Lasts

The Part D late enrollment penalty is also permanent. You pay it every month for as long as you have Medicare prescription drug coverage. This includes Part D plans and Medicare Advantage plans with drug coverage.

The penalty amount may change each year because it is based on a percentage of the national base premium, which can increase or decrease. However, the percentage itself remains fixed based on how long you delayed enrollment.

Part A Late Enrollment Penalty

Most people do not pay a premium for Part A. If you or your spouse worked and paid Medicare taxes for at least 10 years, you qualify for premium-free Part A. In this case, there is no late enrollment penalty.

If you do not qualify for premium-free Part A and must buy it, you may face a penalty if you enroll late. The penalty is 10% of the premium, and you must pay it for twice the number of years you delayed enrollment. This situation is uncommon.

When You Can Avoid Late Enrollment Penalties

Initial Enrollment Period

Your Initial Enrollment Period lasts seven months. It begins three months before the month you turn 65, includes your birthday month, and ends three months after. If you enroll during this window, you will not face any penalties.

Special Enrollment Period for Employer Coverage

If you have health coverage through your or your spouse's current employer, you can delay Part B enrollment without penalty. The employer must have 20 or more employees. You have eight months after your employment or coverage ends to sign up, whichever happens first.

COBRA and retiree health plans do not count as current employer coverage. If you rely on these plans and delay Medicare enrollment, you may face penalties.

Creditable Drug Coverage

You can avoid the Part D penalty if you have creditable prescription drug coverage. This includes employer or union plans, TRICARE, VA benefits, and certain other sources. Your plan must be at least as good as Medicare Part D.

You should receive a letter each year from your plan administrator stating whether your coverage is creditable. Keep these letters. You may need them as proof when you enroll in Part D to avoid a penalty.

How to Avoid Late Enrollment Penalties

The best way to avoid penalties is to enroll on time. Here are key steps to take.

• Sign up during your Initial Enrollment Period when you turn 65.
• If you have employer coverage, confirm it qualifies as creditable and enroll within eight months of coverage ending.
• Keep all creditable coverage letters from your employer or plan administrator.
• Enroll in Part D even if you do not take many medications. The penalty for waiting can outweigh the cost of a low-premium plan.
• If you miss a deadline, enroll as soon as possible to prevent the penalty from growing.

What to Do If You Already Have a Penalty

If you already have a late enrollment penalty, you cannot remove it in most cases. However, you can request a reconsideration if you believe the penalty was applied incorrectly.

Medicare may remove or reduce a penalty if you can prove you were misinformed by a federal employee or if you had creditable coverage but did not receive proper notice. You must provide documentation such as creditable coverage letters or employment records.

To request a reconsideration, contact Social Security for Part B penalties or your Part D plan for drug coverage penalties. Be prepared to wait several weeks for a decision. Most requests are denied unless you have clear proof of an error.

Key Takeaways

Medicare late enrollment penalties are permanent charges added to your monthly premium. They apply to Part B and Part D, and they last as long as you have coverage.

You can avoid penalties by enrolling during your Initial Enrollment Period, maintaining creditable coverage, or using a Special Enrollment Period if you have employer health insurance.

If you have already missed a deadline, enroll as soon as possible to limit the penalty. Keep all documentation related to employer coverage or creditable drug coverage in case you need to prove you had qualifying insurance.