Medicare Late Enrollment Penalties: Parts A, B and D

A Medicare late enrollment penalty is an extra charge added to your monthly premium when you did not sign up for Part A, Part B or Part D at the time Medicare expected you to, and you did not have other qualifying coverage. Part B adds 10% of the standard premium for each full 12 months you went without it, for as long as you have Part B. Part D adds 1% of the national base premium for each full month without creditable drug coverage, for as long as you have drug coverage. Part A only carries a penalty if you have to buy Part A. All three are avoidable with good timing, and the rules below show how.

Which penalties exist and who pays them

There are three, one for each part of Medicare you can sign up for. Most people never pay the Part A penalty, because most people get Part A without a premium after 40 quarters (about 10 years) of work. The Part B and Part D penalties are the ones that catch people, usually after retiring, leaving a job or relying on coverage that turned out not to count.

Two terms come up again and again. Creditable drug coverage means drug coverage expected to pay, on average, at least as much as standard Medicare drug coverage; your employer or plan must tell you in writing each year whether yours is creditable. A Special Enrollment Period is a window outside the usual dates that lets you sign up without a penalty, for example after group coverage from current work ends.

Source: Medicare.gov: The Part D Late Enrollment Penalty (fact sheet).

The Part B penalty, worked out

The Part B penalty is 10% of the standard Part B premium for each full 12-month period you could have had Part B but did not. Partial years do not count: 27 months late is two full periods, so 20%. The penalty is figured on the standard premium for the current year, so the dollar amount moves when the premium moves.

Medicare.gov's own example uses the 2026 standard premium of $202.90 a month. Two full years late adds 20%, or $40.58, for a total of $243.50 a month after rounding. That is about $487 a year on top of the normal premium, every year you have Part B. CMS had not published the 2027 Part B premium as of October 20, 2026, so 2026 figures are used here.

Our Part B penalty calculator, in the Tools section of this site, runs the same math for your own dates.

The Part D penalty, worked out

The Part D penalty is 1% of the national base beneficiary premium for each full month you went without Part D or other creditable drug coverage, rounded to the nearest 10 cents. It starts counting after a gap of 63 days or more in a row once your Initial Enrollment Period ends. The base premium is $38.99 in 2026 and $41.33 in 2027 (CMS), and because it changes every year, your penalty can change every year too. The penalty stays with you even if you switch plans.

Medicare's Part D penalty fact sheet gives a 2026 example: 17 uncovered months is 17% of $38.99, which rounds to $6.60 a month. Using the 2027 base premium, the same 17 months would be $7.00 a month, and 24 months would be $9.90 a month, or $118.80 a year.

Our Part D penalty calculator, also in the Tools section, works out the figure for your months.

Source: Medicare.gov: The Part D Late Enrollment Penalty (fact sheet).

The Part A penalty, for people who buy Part A

If you or your spouse did not pay Medicare taxes long enough, you can still buy Part A. In 2026 that costs $311 a month with 30 to 39 quarters of work and $565 a month with fewer than 30 (CMS). Sign up late and the premium can go up 10%, and you pay the higher amount for twice the number of years you could have had Part A and did not. Two years late means four years of the higher premium. On the $565 premium, 10% is $56.50 a month.

When you will not get a penalty

• You or your spouse are still working and covered by that employer's group health plan. For Part B, this is the main reason people can wait. After the job or the coverage ends, whichever is first, you have 8 months to sign up for Part B without a penalty.
• You had creditable drug coverage, for example from an employer, a union, TRICARE or the VA, with no gap of 63 days or more. Keep the yearly creditable coverage notice: it is your proof.
• You qualify for Extra Help with drug costs. Medicare.gov says people with Extra Help generally do not pay the Part D penalty.
• You sign up during your Initial Enrollment Period: the three months before the month you turn 65, that month, and the three months after.

A New Jersey note on PAAD and Senior Gold

New Jersey's drug assistance programs, PAAD and Senior Gold, require members who are eligible for Medicare to enroll in a Part D plan (nj.gov, 2026). They work alongside Part D rather than replacing it, so they do not stop the Part D penalty clock on their own. If you are applying for PAAD or Senior Gold, make sure your Part D enrollment happens on time too. Our guide to PAAD and Senior Gold in New Jersey explains how the two fit together.

Before you leave a job after 65: a short checklist

• Ask HR for the date your group health coverage ends, in writing. Your 8-month Part B window counts from the earlier of the last day of work or the last day of coverage.
• Ask for the creditable coverage notice for your drug coverage, and keep it. If you later need to show you had creditable coverage, this is the document that does it.
• Sign up for Part B through Social Security using form CMS-40B, Application for Enrollment in Medicare Part B, with form CMS-L564, Request for Employment Information, completed by your employer to show you had group coverage from current work.
• Choose drug coverage so that it starts within 63 days of the old coverage ending, either a Part D plan or a Medicare Advantage plan with drug coverage.
• If you were thinking of COBRA instead of Part B, compare first. COBRA can sit alongside Medicare, but it does not stop the Part B penalty clock.

Small employers and Medicare

Whether you can safely wait on Part B also depends on the size of the employer. If the employer has 20 or more employees, the group plan usually pays first and many people wait on Part B without a penalty. If it has fewer than 20, Medicare usually pays first, and the group plan may pay little or nothing for services Medicare would have covered. In that case you generally need Part B on time. Ask HR how the plan coordinates with Medicare, and see our guide to working past 65 and Medicare for the full picture.

If you already missed the window

If you missed your Initial Enrollment Period and have no Special Enrollment Period, the General Enrollment Period runs January 1 to March 31 each year, and Part B starts the first of the month after you sign up. For Part D, you can generally join during the Annual Enrollment Period, October 15 to December 7, for coverage starting January 1. The sooner you close the gap, the smaller the penalty, because it grows with every month or year you wait.

If you think a Part D penalty is wrong, for example because you had creditable coverage, you can ask for a reconsideration. The Medicare fact sheet says to send the request within 60 days of the date on the letter that tells you about the penalty, and to include proof of your earlier coverage. Part B penalty questions go to Social Security, 1-800-772-1213.

What Jackie checks for you

• Your exact Initial Enrollment Period dates, worked out from your birthday.
• Whether your current health coverage is from active work, and whether the employer has 20 or more employees.
• Whether your drug coverage notice says creditable, and the date any gap would begin.
• Which Special Enrollment Period you are in after leaving a job, and the deadline it gives you.
• That your new Part D or Medicare Advantage drug coverage starts with no gap of 63 days or more.

Figures used in this guide

Source: Medicare.gov: The Part D Late Enrollment Penalty (fact sheet).

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The bottom line

Penalties are permanent, but they are also predictable. Before you turn 65, leave a job or drop any coverage, check two things: whether your health coverage is from current work, and whether your drug coverage is creditable. If either answer is unclear, ask before the deadline rather than after. Jackie can look at your dates and paperwork with you by phone, Zoom or in person, at no cost, and tell you plainly which enrollment window you are in. Call or text (856) 727-4221.