Medicare Part D Late Enrollment Penalty
Went a while without prescription drug coverage? You may owe a Part D penalty — and it's one most people never see coming. Here's how it works, plus a calculator to estimate your own number.
The Part D late-enrollment penalty applies if you go 63 or more days in a row without creditable drug coverage after your Initial Enrollment Period ends. "Creditable" simply means coverage that's at least as good as a standard Medicare drug plan — for example, many employer, union, or VA plans qualify.
It's calculated as 1% of the national base beneficiary premium for each full month you went without creditable coverage, and that amount is added on top of whatever Part D plan you choose. Because it's tied to the national base premium, the penalty can rise a little over time.
And the part that surprises people most: in most cases the penalty is permanent — you pay it for as long as you have Part D coverage. That's why even a short gap is worth understanding.
Use the calculator below to estimate what a coverage gap could cost you.
Not Sure If Your Old Coverage Was Creditable?
If you had employer, union, or VA drug coverage, it may have counted as creditable — which could reduce or even erase a penalty. Let's review your coverage history together and see what we can do, at no cost.
Schedule a Free Call