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Penalty Relief for Late Medicare Enrollment

Health care coverage has been a hot topic in politics for a number of years now.  Since the passage of the Affordable Care Act, some confusion has resulted for people who have also become eligible for Medicare during this time.  Late enrollment in Medicare can lead to significant penalties for an individual’s premiums.  Time is running out to obtain relief from these penalties.

Here’s a quick review of Medicare:

Part A:  Hospital insurance.  If you paid Medicare taxes while working, you will not have a monthly premium for this coverage.

Part B:  Insurance which covers physician services, preventative care, medical equipment, outpatient services, diagnostic testing, mental health care, and some home health services.  There is a monthly premium for everyone for this coverage.  If you are receiving Social Security retirement benefits, the premium is deducted from your benefit.  Parts A and B are also known as “Original Medicare”.

Part C:  Medicare benefits which are provided by private insurance companies instead of the federal government.  Part C is also known as Medicare Advantage plans.

Part D:  Outpatient prescription drug coverage which is provided by private insurance companies who contract with the federal government.

Most people who are receiving Social Security or Railroad Retirement benefits for at least four months prior to turning age 65, or who are under age 65 and have received disability benefits under one of these programs for at least 24 months, will automatically receive Part A and Part B coverage.  Others are required to sign up for Medicare within a seven month window of their 65th birthday (3 months before, the month of, and 3 months after).

People who fail to sign up for Part B coverage within the initial enrollment period outlined above are assessed a penalty for late enrollment unless they qualify to enroll during a Special Enrollment Period.  This penalty is up to 10% of the monthly premium for every full 12 month period that one was eligible for coverage but didn’t  sign up for it.  The standard base premium for 2018 is $134/month.  If an individual was eligible for Medicare three years ago, and didn’t sign up until this year, the monthly premium would be $174.20 (base premium plus 30%).  This penalty must be paid every month for as long as the individual keeps Part B coverage.

Participation in an exchange plan through the Affordable Care Act is not a valid exception for the need to enroll in Medicare at age 65.  This fact has not been clearly understood by many people, and has resulted in significant penalties.  People who purchased exchange plans through federal marketplaces should have received notifications about the need to enroll in Medicare, however, marketplaces which are run by individual states are not required to notify their policyholders about Medicare enrollment.

Since March of 2017, the Centers for Medicare & Medicaid Services (CMS) has allowed individuals in certain circumstances to enroll in Medicare Part B without late enrollment penalties.  CMS is also providing an opportunity for some people who are already paying penalties to have them reduced.  Time is running out for individuals to apply to obtain this relief, as a deadline has been set for September 30, 2018.  To find out if you qualify for relief, visit your local Social Security office.  Due to the complexity of the rules, you may want to bring a copy of the instructions which the Social Security Administration provided to local offices to support your request.  The instructions can be found here:  For complete details about enrolling in Medicare, please visit

Keystone Elder Law’s next free seminar will cover Retirement Living Options, and will be presented by Attorney Dave Nesbit on Thursday, July 26th at 3:00pm at our office.  No registration required.

Karen Kaslow, RN, BSN