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This Week’s Medicare Quick Bite is Part D Late Enrollment Penalty!

“Medicare Quick Bites” is your weekly treat of Medicare information. Hawaii SHIP has created these bite-sized lessons to help you understand this complex federal health insurance, thus “Making Medicare Digestible!” Follow us on Facebook or Twitter to get your weekly delivery of Medicare Quick Bites! This week’s treat is Late Enrollment Penalty for Part D.

Last week’s Medicare Quick Bite explained the Special Enrollment Period for Part D which is 63 days to sign up for Part D after losing creditable drug coverage. “Creditable drug coverage” is as good or better than Medicare. If you don’t sign up for drug coverage through a Part D plan during the Special Enrollment Period, you will incur a late enrollment penalty. The late enrollment penalty is a dollar amount that’s permanently added to Part D drug coverage if you didn’t enroll into Part D – Prescription Drug Plan when you were first eligible during your Initial Enrollment Period or during the Part D Special Enrollment Period.

Example: Kaleo is currently eligible for Medicare, and his Initial Enrollment Period ended on May 31, 2018. Although he enrolled into Parts A & B at that time, he didn’t enroll into a Part D plan. He enrolled into a Part D plan during the 2020 Open Enrollment Period with his coverage starting January 1, 2021. Since Kaleo didn’t have creditable drug coverage from June 2018 thru December 2020, his penalty was 31% (1% for each of the 31 months) of $33.06 (the national base beneficiary premium for 2021), or $10.25. Kaleo’s total monthly premium for 2021 was $43.31.

MedQkBite_LEP Part D_11.10.2021

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