Why do some seniors end up paying lifelong penalties for Medicare Part B or Part D?
Answered by 15 licensed agents
Lack of appropriate retirement planning education. One of the foundations I have built my business on is education. Medicare 101 seminars can be really useful to people to learn how to avoid these penalties.
It is important to know that unless you have what is known as Creditable Coverage, delaying Part B and or Part D can carry lifelong penalties. Each situation is unique so it’s important to consult with a professional to understand if you have Creditable Coverage or not and have a plan in place, months before you turn 65. Sorting out your Medicare coverage is best done up to 3 months before you turn 65.
Some seniors face lifelong penalties for Medicare Part B or Part D because they miss their initial enrollment period—typically the seven months surrounding their 65th birthday—and lack qualifying coverage, such as an employer plan, to justify delaying enrollment. For every year they’re late, Part B adds a 10% premium penalty, while Part D increases by roughly 1% per month missed, and these extra costs stay with you permanently since Medicare enforces timely sign-ups to maintain its structure. I’ve seen this catch people by surprise, especially when they overestimate their existing coverage, making it a costly oversight to avoid.
If you do not sign up for Part B or Part within a certain period of time of your credible coverage ending you end up with a lifelong penalty for Part D. It is 1% for every month you don't sign up.
Seniors who end up paying lifelong penalties must do so because they neglected to enroll in Part B when they were originally eligible. There is a monetary penalty for each month they were eligible, but did not enroll in Part B unless they had creditable health coverage through employment.
Because they didn't enroll in a timely manner for Part B and Part D - they were given poor information from their Plan administrators OR they had NO idea they had to enroll.
Seniors pay lifelong penalties for Medicare part B or part D because they don't receive on time proper information from the right people who are Medicare Certified.
When they were originally eligible for Medicare part B or a part D plan they did not enroll and Medicare starts keeping track after 63 days or more In which you were uncovered. The kicker is that Medicare doesn’t assess that penalty until you get Medicare part B. Same goes with part D, If you didn’t get a prescription plan when you were first eligible for one and 63 days or more has passed then Medicare will keep track of the number of months that you didn’t have a prescription drug plan and a penalty that roughly ends up being about $.35 per month (in AZ) gets multiplied by the number of months that you didn’t have prescription drug coverage. That amount gets added to what your part D premium is.
These are unfortunate situations that could've been avoided if they had reached out to an agent upon getting on Medicare. Knowledge is powerful and some people bypass the free counseling that an experienced agent can provide...then it costs them in the end...sometimes for life! These are penalties for generally late enrollment.
It's because there is so much information that is misleading. I believe the finding a good agent to work on your side will help seniors not make that mistake!
Some seniors end up paying lifelong penalties for not enrolling in either Part B or D during either their Initial Enrollment Period or Special Enrollment Period. It's very important to understand the enrollment periods and when they apply. Miss an enrollment period and potentially a penalty will be assessed by Medicare unless there is a valid reason/explanation.
Because they either think they don’t need it or they miss the deadlines. If you don’t sign up when you’re supposed to, you can get stuck with a penalty that lasts for life.
If you do not pick up your part b when first eligible for Medicare you will be charged a penalty whether under 65 or at 65. If you are under 64 and do not pick up part b then, when you turn 65 and pick it up the penalty goes away.
For part d, if you do not pick up a plan when eligible then you have the penalty
If you don’t have creditable coverage when you turn 65 then you need to activate your Part B and Part D. If you don’t then you will have penalties for the rest of your life when you do activate it.
