The Medicare program has been designed to help senior citizens in America. However, if you make a delay in signing up for Medicare, you might have to pay an exorbitant amount as a fine. Medicare can charge you late-enrollment fines. These penalties have the purpose of discouraging you from letting go of coverage without taking advantage and then incurring medical bills that burn a hole in the pocket. If you want to avoid higher premiums, you have to have proper knowledge about these penalties and take the necessary steps to avoid the penalties. Following are some Medicare late enrollment penalties you should know about. Go through them.
What Are Medicare Penalties?
You need to pay an extra amount in case you sign up late for its Part A, Part B, and Part D plans. Part A is for inpatient hospital services, Part B is for outpatient medical services, while Part D is for prescription drugs.
You become eligible for Part A with no premiums in case both you and your spouse have been paying Medicare taxes for a minimum period of 10 years while actively working. If you are not eligible, you can buy Part A coverage. However, if you fail to sign up within your first enrollment period, your premium will rise by 10%. You will have to shell out this extra rate for double the number of years you have been unable to enroll. Therefore, if you are late by two years, you will face four years of higher premiums. If you are eligible for a no-premium Part A plan, you will not be liable to shell out any fine.
Part B and Part D Penalties
If you are late in enrolling for Part B, premiums will rise by 10%. But it doesn’t end there. You have to shell out 10% extra for each period of 12 months that goes by after you attain eligibility to enroll. You pay the fine as long as you stay in Part B.
Suppose you didn’t sign up for Part B until two and a half years after the culmination of your first eligibility period. After two 12-month periods pass, you pay an extra 20% for as long you are signed up for Part B. Talking about Part D, it provides coverage for prescription drugs. The plan pays when you first sign up after attaining eligibility. If you are running without proper drug coverage, offered by Medicare or your employer for more than two months after the culmination of your first enrollment period, you will have to shell out a penalty. How much would you need to pay? Well, that depends on the time you spend without coverage.
How Can You Avoid Paying a Penalty?
If you want to avoid paying a penalty, the best thing you can do is to get enrolled within the first seven-month enrollment period. You will only be exempted if you become eligible for a special enrollment period and have sufficient documents to prove it. You generally attain eligibility for a special enrollment period if you have other health insurance coverage that can be considered creditable.
In case both you and your spouse are working, you can receive creditable health insurance coverage through your employer. If you and your spouse are doing service in the military, the health coverage can be through a military health benefits program. If you attain eligibility for a special enrollment period and are receiving coverage from another group plan, you can still get enrolled. As far as Part A and Part B are concerned, you have time up to eight months after your other health coverage gets over. On the other hand, you only have just over two months to sign up for Part D without having to pay a penalty.
What Can You Do About a Penalty?
If you think that you have been wrongly penalized by Medicare, you can ask for a review. Usually, you have a two-month window after Medicare sends you a letter intimating you about the penalty. There is a reconsideration request form that you need to fill up with proper evidence that supports your argument.
If you need help, you can take the help of an experienced attorney to go through this procedure. There is an Appointment of Representative Form that you need to fill up.