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Ashford Insurance

Part D Late Enrollment Penalty

Part D Medicare Made Easy

Part D Late Enrollment Penalty

The late enrollment penalty is an amount added to your Medicare Part D monthly premium.

You may owe a late enrollment penalty if, for any continuous period of 63 days or more after your Initial Enrollment Period is over, you go without one of these:

A Medicare Prescription Drug Plan (Part D)

A Medicare Advantage Plan (Part C) (like an HMO or PPO)

Another Medicare health plan that offers Medicare prescription drug coverage

Creditable prescription drug coverage

How Much is the Part D Penalty in 2022?

The cost of the late enrollment penalty depends on how long you went without Part D or creditable prescription drug coverage.

Medicare calculates the penalty by multiplying 1% of the “national base beneficiary premium” ($33.37 in 2022) times the number of full, uncovered months you didn’t have Part D or creditable coverage. The monthly premium is rounded to the nearest $.10 and added to your monthly Part D premium.

How do you calculate your premium penalty?

Let’s say you delayed enrollment in Part D for seven months (and you do not meet any of the exceptions listed above). Your monthly premium would be 7% higher for as long as you have Part D (7 months x 1%). The national base beneficiary premium in 2022 is $33.37 a month. Your monthly premium penalty would therefore be $2.31 ($33.37 x 1% = $0.3337 x 7 = $2.34) per month, which you would pay in addition to your plan’s premium.

Note: The Part D penalty is always calculated using the national base beneficiary premium. Your penalty will not decrease if you enroll in a Part D plan with a lower premium.

Learn How Medicare Works Here

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