3 Ways to Avoid Paying a Late Enrollment Penalty

Part D Late Enrollment Penalties

The late enrollment penalty is an amount that is added to your Part D Premium. You may owe a late enrollment penalty if at any time after your Initial Enrollment Period is over, there is a period of 63 or more days in a row when you do not have Part D or other creditable prescription drug coverage. You will generally have to pay the penalty for as long as you have Part D coverage.

3 ways to avoid paying a late penalty:

  1. Join a Medicare drug plan when you are first eligible

    • Even if you do not take many prescriptions now, consider joining a Medicare drug plan. You may be able to find a plan that meets your needs with little to no monthly premiums.
  2. Do not go 63 days or more in a row without a Medicare drug plan or other creditable coverage

    • Creditable prescription drug coverage could include drug coverage from a current or former employer, union, TRICARE, Indian Health Service, the Department of Veteran Affairs, or health coverage. Your plan must tell you each year if your drug coverage is creditable. This information may be sent to you via letter, benefit handbook, or included in a newsletter from the plan. Keep this information because you may need it if you join a Medicare drug plan later.
  3. Tell your plan about any drug coverage you had if they ask about it

    • When you join a Medicare drug plan, and the plan believes you went at least 63 days in a row without creditable prescription drug coverage, the plan will send you a letter. The letter will include a form asking about any drug coverage you had. Complete this form, and return it to your drug plan by the date listed on the form. If you do not tell the plan about your creditable prescription drug coverage, you may have to pay a penalty for as long as you have Part D coverage.

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