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Medicare Part B Penalty

Crowe and Associates wants to make sure that you are aware that there is  a Medicare Part B Penalty.  In most cases, if you don’t sign up for Part B when you’re first eligible, you will have to pay a late enrollment Medicare Part B penalty. Medicare will be charge you this penalty for as long as you have Part B. Your monthly premium for Part B may go up 10% for each full 12-month period that you could have had Part B, but didn’t sign up for it.

Click here to access Medicare.gov for more information regarding the Part B penalty.

How do you calculate your premium penalty? Let’s say you turned 65 in 2009, and you delayed signing up for Part B until 2016.  If you did not have employer insurance that allows you to delay enrollment. Your monthly premium would be 70 percent higher for as long as you have Medicare (7 years x 10 percent). Since the Medicare Part B premium in 2016 is $121.80, your monthly premium with the penalty would be $207.06 ($121.80 x 0.7 + $121.80).

Note:  Although Medicare calculates the penalty you pay by using the standard Part B Premium. Your Part B premium amount is based on your income.  Medicare then adds the penalty amount to your actual premium amount.

To learn more about avoiding the Medicare Part B penalty, or how to navigate the Medicare enrollment process, call the office at 203-796-5403 or email us at admin@croweandassociates.com.  We are leading Medicare specialists and are here to help.  There is never a fee for our advice.

Click here for a free Medicare quote.

When someone first becomes eligible for Medicare, they have the choice to sign up for part B.  Part B of Medicare covers physician and outpatient services at 80% after a $144 deductible.   Part B doe have a cost which is $104.90 a month. (deducted out of your social security check or billed quarterly)

Should everyone sign up for part B?  The answer is no.  Anyone that 65 or older and actively working may get stronger coverage from their employer.  If they are actively at work, they do not need to sign up for part B.   They can wait until they retire and sign up then. There will not be a penalty because they are actively at work. (same goes for someone getting benefits from an actively working spouse)

If you are getting benefits but not actively at work, you will be accumulating a penalty for not taking part B when you are eligible for it. The penalty is 10% of the premium for every year you are eligible but do not elect part B.    This may be a problem if you ever lose your retiree coverage and need to sign up for B down the road.