What Are the Medicare Late Enrollment Penalties?
Medicare Late Enrollment Penalties FAQ
If you delay enrolling in certain parts of Medicare without having creditable coverage, you may face a Late Enrollment Penalty (LEP). This can lead to permanent increases in your monthly premiums.
-
Who it applies to:
Only affects people who must pay a premium for Part A — typically those who did not work (or pay Medicare taxes) for 10 years (40 quarters).
Penalty:
• 10% increase in your monthly premium
• You pay the higher premium for twice the number of years you delayed enrollment
⚠️ Most people do not pay for Part A, so this penalty is rare.
Exceptions:
• If you qualify for Medicare due to disability before age 65, you will not be charged a Part A premium.
-
Who it applies to:
Anyone who delays enrolling in Part B without having creditable employer coverage (typically from a large employer plan).
Penalty:
• 10% added to your Part B premium for every 12-month period you were eligible but didn’t enroll
• This penalty is for life — it does not go away
Example:
If you delay Part B by 3 years, your premium increases by 30% every month — permanently.
-
Who it applies to:
Anyone who goes 63 days or more without creditable prescription drug coverage after becoming eligible for Medicare.
Penalty Formula:
1% of the national base premium × number of months without coverage
Rounded to the nearest $0.10
Important Notes:
• The national base premium changes yearly, so the penalty may increase slightly each year.
• The Part D plan you enroll in is responsible for notifying you of the penalty amount.
How to Avoid These Penalties
• Enroll on time during your Initial Enrollment Period
• Only delay enrollment if you have creditable coverage (from an employer, VA, TRICARE, etc.)
• Keep documentation of creditable coverage in case you need to prove it later