Medicare · Cornerstone
The Part B late enrollment penalty
Last reviewed June 11, 20264 min readBy the Goodsurance editorial team Reviewed by the Goodsurance editorial team
Most Medicare mistakes can be fixed. This one mostly cannot, and that is what makes it worth a whole article. The Part B late enrollment penalty is permanent: once it attaches to your premium, it stays there for as long as you have Part B, which for most people means the rest of their life. It is also entirely avoidable, which is the frustrating part. Nearly everyone who gets hit with it did not know the rule. So this page has one job: make sure you are not that person.
1How the penalty works
The rule itself is simple. For every full 12-month period you could have had Part B but did not, your premium goes up by 10%, permanently. Note the "full 12-month" part: the penalty counts completed 12-month blocks, so a delay of, say, 18 months is penalized as one full period, not one and a half.
Two words carry the weight. "Permanently" means it does not expire; it is not a one-time fee or a catch-up payment, it is a higher premium for good. And the penalty is calculated as a percentage of the standard premium, so as the Part B premium rises over the years, your penalty rises with it. It compounds against you over a long retirement in a way a flat fee never would.
2The math, made concrete
Numbers make this land better than warnings do. Suppose you delayed Part B for three full years without a valid reason. That is a 30% permanent penalty added to your premium. Applied to the 2026 standard premium of $202.90 a month, a 30% penalty adds roughly $61 a month. That is about $730 a year, every year, for as long as you have Part B, and it grows as the base premium grows. Over a twenty-year retirement, a three-year delay you did not understand turns into many thousands of dollars.
It is worth noting that Parts A and D have their own late penalties, structured differently. Most people get Part A premium-free, so its penalty rarely applies, but Part D carries a separate, also-permanent penalty for going without creditable drug coverage. The point here is that "I'll deal with Medicare later" can quietly stack more than one lifelong surcharge.
3The one situation where waiting is fine
Here is the relief, because the penalty has a large and legitimate exception. If you are still working at 65 and have coverage through an employer with 20 or more employees, you can delay Part B with no penalty at all, and enroll later through a Special Enrollment Period when that coverage ends. This is exactly how the system is meant to work for people still on the job with solid coverage.
The trap is in the boundaries of that exception, and this is where people who think they are safe get caught. A small-employer plan (under 20 employees) often does not protect you, because Medicare tends to become the primary payer at 65 regardless of what the group plan says, and if Medicare is primary and you have not enrolled, your group plan may pay almost nothing. COBRA is not active employer coverage for this purpose. And retiree coverage from a former employer does not count either. The coverage felt real, but it was not the specific kind that protects your enrollment window.
- Under 20 employees, often does not protect you
- Medicare is primary at 65 regardless
- Not active employer coverage
- The penalty clock may be running
- From a former employer, does not count
- Not active-employment coverage
4How the Special Enrollment Period actually works
If you did delay correctly, with active coverage from a large employer, the path back is clean, but it has a clock. When that employment or coverage ends, you generally get an eight-month Special Enrollment Period to enroll in Part B without penalty. Two details trip people up.
First, the window starts when the employment or the coverage ends, whichever comes first, not when you decide you are ready. Second, COBRA does not extend it, even though COBRA can last longer than eight months. People go onto COBRA when they retire, treat it as their coverage, and let the eight-month Part B window quietly close behind them, landing in the penalty after all. If you are retiring at or after 65, the move is to enroll in Part B as your employer coverage ends. To use the SEP, you typically submit your Part B application along with a form your employer completes verifying you had active group coverage.
Your eight-month exit window
5What to do if you are unsure, or think a penalty was applied wrongly
If you are approaching 65, or past it and wondering whether you should already have enrolled, the safe move is to confirm your specific situation before you assume either way. The penalty is permanent, but it only applies when the delay was not protected, and whether yours was protected comes down to details that are not always obvious: employer size, the type of coverage, the timing. This is one of the few Medicare questions where being a little early costs nothing and being a little late costs you for life.
And if a penalty has already been applied that you believe is wrong, for example you did have qualifying employer coverage and it was not credited, you can request a review. There is a process to appeal a late-enrollment penalty determination, and it is worth pursuing when the facts are on your side. Keep your records of prior coverage; they are what make an appeal winnable.
Common questions about Medicare
Quick answers to common questions
Tap any question to expand. Each question links to a fuller standalone answer.
What is the Part B late penalty?
The Part B late penalty is a permanent surcharge added to your Part B (medical) monthly premium if you delay enrolling without qualifying coverage.
The penalty is 10% of the standard premium for each full 12 months you could have had Part B but did not sign up. Because it is based on full 12-month periods, waiting two full years would add 20%, and so on. The surcharge is permanent, meaning it stays on your premium for as long as you have Part B, not just for a year. You can avoid it by enrolling during your Initial Enrollment Period or by having qualifying coverage, like active employer insurance, that lets you delay. To check whether a penalty applies to you, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
How much is the Part B penalty?
The Part B penalty adds 10% to your Part B (medical) premium for each full 12 months you could have enrolled but did not.
So one full year late adds 10%, two full years adds 20%, and it keeps climbing with each additional full year of delay. The penalty is calculated as a percentage of the standard premium, which is $202.90 per month in 2026, and the surcharge is permanent: it stays on your premium for as long as you have Part B. Because the base premium can change from year to year, the dollar amount of your penalty can shift too, but the percentage tied to your delay stays the same. To work out what a penalty would mean for you, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
Can I avoid the Part B penalty?
Yes, you can avoid the Part B (medical) penalty by enrolling on time or by having qualifying coverage that lets you delay.
The simplest way is to sign up during your Initial Enrollment Period, the seven-month window around your 65th birthday. If you keep working past 65 and have active employer coverage through a job with 20 or more employees, you can delay Part B without penalty and enroll later using a Special Enrollment Period, which gives you 8 months after that employment or coverage ends, whichever comes first. Watch out: retiree coverage, COBRA, and marketplace plans do not count as qualifying coverage for this purpose, so delaying with those can trigger the penalty. To confirm your coverage qualifies, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
Is the Part B penalty a one-time fee?
No, the Part B (medical) penalty is not a one-time fee; it is a permanent surcharge added to your monthly premium.
Once a late penalty applies, it stays on your Part B premium for as long as you have Part B, not just for a single year or a single payment. The penalty equals 10% of the standard premium for each full 12 months you delayed enrolling without qualifying coverage, so the longer the delay, the larger the ongoing surcharge. Because it is permanent and recurring, enrolling on time or keeping qualifying coverage matters well beyond your first year. To check whether a penalty would apply to you and how to avoid one, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
When can I enroll in Medicare?
Most people can first enroll in Medicare during their Initial Enrollment Period, a seven-month window around your 65th birthday that starts three months before the month you turn 65, includes that month, and ends three months after.
If you miss it, the General Enrollment Period runs January 1 to March 31 each year for Part A and Part B. After you have Medicare, the Annual Enrollment Period from October 15 to December 7 (2026) lets you change Part D drug plans and Medicare Advantage plans, with changes effective January 1. The Medicare Advantage Open Enrollment Period from January 1 to March 31 (2026) lets people already in a Medicare Advantage plan switch once. Special Enrollment Periods may also apply after certain life events, like losing job coverage. To review which window fits you, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
What is AEP in Medicare?
AEP stands for the Annual Enrollment Period, the yearly window when anyone with Medicare can make changes to their coverage.
It runs from October 15 to December 7 (2026), and the changes you make take effect January 1 of the following year. During AEP you can join, switch, or drop a Medicare Advantage plan (Part C), join, switch, or drop a Part D prescription drug plan, and move between Original Medicare and Medicare Advantage. This is the main once-a-year opportunity to review your plan against your current doctors, medications, and budget, since plans can change their costs and coverage each year. AEP is different from the Medicare Advantage Open Enrollment Period, which runs January 1 to March 31 (2026) and only lets people already in a Medicare Advantage plan make one switch. If you want to change plans, AEP is usually the time to do it.
What is the Medicare Open Enrollment Period?
The term Medicare Open Enrollment Period is used two ways, so it helps to be specific.
Most often people mean the Annual Enrollment Period (AEP), which runs October 15 to December 7 (2026) and lets anyone with Medicare join, switch, or drop a Medicare Advantage plan (Part C) or a Part D drug plan, with changes effective January 1. Separately, the Medicare Advantage Open Enrollment Period runs January 1 to March 31 (2026) and lets people already enrolled in a Medicare Advantage plan make one change, such as switching to another Medicare Advantage plan or returning to Original Medicare. There is also a Medigap Open Enrollment Period, a six-month window that begins when you are 65 or older and enrolled in Part B, during which you can buy a Medigap (supplement) policy without health-based pricing. Knowing which one you mean determines what you can change.
Can I change my Medicare Advantage plan in January?
Yes.
If you are already in a Medicare Advantage plan (Part C, your Medicare benefits through a private plan), the Medicare Advantage Open Enrollment Period lets you make one change between January 1 and March 31 (2026). During this window you can switch to a different Medicare Advantage plan, or leave Medicare Advantage and return to Original Medicare, and if you return to Original Medicare you can also add a Part D drug plan. This window is only for people who already have a Medicare Advantage plan on January 1; it is not a time to switch from Original Medicare into Medicare Advantage. You get one change during this period, and it takes effect the first of the month after the plan receives your request. This is separate from the Annual Enrollment Period, which runs October 15 to December 7 (2026). If you missed making a change during AEP, the January to March window is a second chance for current Medicare Advantage members.
How do I sign up for Medicare?
You sign up for Medicare through Social Security, online at ssa.gov, by phone, or in person at a Social Security office; Medicare itself does not handle enrollment.
The best time is your Initial Enrollment Period, the seven-month window around your 65th birthday. If you already receive Social Security benefits, you are usually enrolled automatically in Part A and Part B. If you are not yet drawing Social Security, you have to apply yourself. After you have Part A and Part B, you can separately choose added coverage like a Part D drug plan, a Medicare Advantage plan, or a Medigap supplement. To talk through which added coverage fits your situation, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
Is Medicare automatic at 65?
Medicare is not automatic for everyone at 65; it depends on whether you already receive Social Security.
If you are drawing Social Security or Railroad Retirement benefits before 65, you are usually enrolled automatically in Part A (hospital) and Part B (medical), and your card arrives a few months before your birthday. If you have not started those benefits, enrollment is not automatic, and you must apply yourself through Social Security during your Initial Enrollment Period, the seven-month window around your 65th birthday. People who qualify through disability are often enrolled automatically after 24 months of benefits. Even when Part A and B are automatic, drug coverage and other plan choices are not. To review your options, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
Where do I enroll in Medicare?
You enroll in Medicare through the Social Security Administration, not through Medicare directly.
You can apply online at ssa.gov, by phone, or in person at a local Social Security office. Railroad retirees apply through the Railroad Retirement Board instead. This applies to Part A (hospital) and Part B (medical). Added coverage works differently: you enroll in a Part D drug plan, a Medicare Advantage plan, or a Medigap supplement through the insurance company offering it or with help from a licensed agent, not through Social Security. Knowing which door to use saves time and helps avoid gaps. To get help choosing and enrolling in added coverage, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
Do I need to sign up for Medicare if I have other insurance?
It depends on the kind of other insurance you have.
If you have active employer coverage through a job with 20 or more employees, where you or your spouse still work, you can usually delay Medicare without penalty and sign up later through a Special Enrollment Period. If your employer has fewer than 20 employees, Medicare often becomes the primary payer, so you typically need to enroll at 65 to avoid gaps. Retiree coverage, COBRA, and marketplace plans generally do not count as active employer coverage, so delaying Medicare with those can trigger a late penalty. The rules turn on whether the coverage is active and the employer's size. To check your specific situation, reach out to a licensed Goodsurance advisor at 1-888-301-8091 (TTY 711), Mon to Fri 8 am to 5 pm PT.
References
- Medicare.govThe Part B late enrollment penalty, Special Enrollment Periods, and appeals.
- CMS, Centers for Medicare & Medicaid ServicesFederal rules on penalty calculation and creditable coverage. cms.gov
- SSA, Social Security AdministrationPart B enrollment, penalty administration, and reconsideration. ssa.gov