Delaying your enrollment in Medicare can have a lasting impact on your future health-care costs. Before you put off enrolling, be aware of the consequences.
Let’s begin with Medicare Part A. Part A is premium-free if you or your spouse worked and paid taxes for ten years or more. If you are not eligible for premium-free Part A and you delay enrolling, you will be assessed a 10% penalty. You will be charged the penalty for twice the number of years you could have had Part A, but didn’t sign up.
Not enrolling in Medicare Part B when you first become eligible will result in a penalty of 10% of the Part B premium for every 12 months you put off signing up. In most case, you will pay the penalty as long as you have Part B coverage.
There is an exception. You are not required to take Part B if you or your spouse is still working and you have coverage as a result of that employment. Once this qualifying insurance ends, you and your spouse would be able to enroll without penalties.
The late enrollment penalty for Medicare Part D depends on how long you go without Part D or other creditable prescription drug coverage. Medicare calculates the penalty by multiplying 1% of the ‘national base beneficiary premium’ ($35.63 in 2017; $35.02 in 2018) times the number of full, uncovered months you did not have Part D or creditable coverage. You will pay this penalty for as long as you are enrolled in a Medicare Part D plan.