What is the Medicare Part B Late Enrollment Penalty?
What is the Medicare Part B Late Enrollment Penalty?
If you’re eligible to get Medicare Part B, and you actively choose not to enroll in it for some reason, not only will you not have coverage for some healthcare items, but if you ever do want to sign up for Part B, you’ll get penalized for the rest of your life. You’ll get charged an additional 10% higher Part B premium for every year you should or could have had Part B, but, for whatever reason, didn’t. If you defer enrolling in Part B because you’re still working past age sixty-five and getting health insurance through your employer, you won’t be penalized for enrolling. Once you stop working and want Medicare Part B, you can sign up then. The only situation in which you’ll ever be penalized for not signing up for Medicare Part B is when you should and could have but chose not to. If you simply didn’t want Medicare Part B for some reason but didn’t have any other form of insurance, then wanted it later, you could still get it during the General Enrollment Period (starting on January 1 of each year), but you’ll suffer the lifelong premium penalty.
For help or questions about Medicare Part B and transitioning from full-time work to Medicare, call or make an appointment today at Chicagoland Medicare.
Medicare Part B and Working Past Age Sixty-Five
It’s estimated that around 40% of people are now working past the “typical” retirement age of sixty-five, but by age seventy, most folks have stopped full-time work. So, if you’re still working, you can defer signing up (and paying for) Medicare Part B until later and not get penalized when you eventually re-apply to get Medicare Part B. Here’s what you need to be thinking about:
You’re still working for an employer who has over twenty employees and are receiving health insurance benefits through your employer and want to keep it that way. Maybe your employer pays all of your premiums. Maybe your spouse or partner isn’t eligible for Medicare yet, and you carry the insurance. In that case, you can “accept” Part A and defer enrollment in Part B. If this describes you, then you won’t get a Part B penalty when you eventually retire and sign up, as long as you have “creditable coverage.”
If you work for an employer that has under twenty employees, you’ll have to get Medicare Part A and B when you’re eligible. There are reasons for that, but they don’t really matter to you, the consumer. Thus, it usually makes sense to drop your employer plan at that time while still working for the company because your employer-sponsored health insurance is usually way more expensive than Medicare Parts A and B and any other Medicare insurance plans you can layer on top of it. If you think your company is close to that twenty limit, check with the owner or their HR person to make sure.
Finally, some employers are now allowing the employee to get Medicare and still cover family members. This way, it’s cheaper for the employer. There are always other exceptions and arrangements people make. Ask your HR department.
Remember—if you defer Part B or Part D enrollment, expect Medicare to ask you to prove you had coverage when you do eventually sign up for either. Don’t throw away your paperwork. Your HR department will have to give you a CMS-L564E form attesting that you did indeed have group health plan coverage.
When your employer-based group coverage ends, you will have eight months to enroll in Medicare Part B regardless of your age. If you don’t do it within eight months, you’ll get the dreaded penalty.
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Frequently Asked Questions
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Independent Medicare insurance agents and agencies such as Chicagoland Medicare get paid by the insurance companies they represent. The commissions we are paid are already built into the insurance policy you’ve purchased, and there isn’t a way to carve them out of the monthly premium. There is no extra fee for buying a Medicare insurance policy through Chicagoland Medicare, nor will you ever pay a fee for our help.
A local, independent Medicare insurance agent represents multiple carriers so that they can work to give you an unbiased opinion on your Medicare insurance plan options. Chicagoland Medicare agents and agencies are state-licensed, trained, tested and appointed by a hand-selected number of Medicare insurance companies to be able to shop and compare Medicare insurance polices to make sure we find the right fit for you! We explore your healthcare and financial needs and listen to your feelings around options available in your local area. We search for a plan that most closely fits your individual needs and budget.
Is Chicagoland Medicare free? Yes, our services are completely free to you and anything we get paid is paid to us by the Medicare insurance companies.
The monthly premiums you pay for your Medicare insurance policies are exactly the same. You cannot buy a Medicare insurance policy directly from a Medicare insurance company at a lower rate.
We have years of experience selling Medicare insurance in the Chicago area including Illinois, Wisconsin and Indiana.
There are all sorts of differences in the amount of coverage and they type of Medicare insurance coverage you can buy depending on what state and county you live in! Chicagoland Medicare independent Medicare agents have a lot of real-world experience and insight regarding the inner-workings of Medicare insurance companies that you, the consumer, may not have access to, such as Medicare Advantage service areas, Medicare Supplemental (Medigap) annual premium increase trends, application fees, discounts programs and more.
Only independent Medicare insurance agents and agencies like Chicagoland Medicare can offer a variety of plans and an unbiased, multi-company approach so our recommendations are objective unbiased and personalized when we sell you a Medigap, Medicare Advantage or Part D drug plan that’s right for you.
At Chicagoland Medicare, we specialize in Medicare insurance products. Period. We’re not distracted by attempting to sell you life insurance, financial planning services, stocks, bonds or anything else. Medicare insurance is all we do! Unlike many other Medicare insurance agents and brokers, we don’t sell group small business health insurance polices, disability insurance, home or auto insurance. We are a boutique Medicare insurance agency, we like it that way and we’re awesome at what we do.
We only partner with ‘A’ rated, household name, established Medicare insurance companies who offer Medicare Advantage, Medicare Supplement, Medigap and Medicare Part D plans in Illinois, Indiana and Wisconsin.
We do not contract with, nor offer our clients startup, new or state-based, regional Medicare insurance companies. We believe in partnering with established companies for consistency, financial strength and experience.
Sometimes, Medicare insurance agents and agencies try to offer too many different insurance products from too many companies. There are literally thousands of combinations of Medicare insurance plan combinations to choose from in the Chicago area – we choose to focus on a select few of large, reliable, well-established, and financially sound Medicare insurance companies to partner with. Oftentimes, other local Medicare agents and agencies get pulled in too many directions with too many insurance offerings and therefore can’t be as knowledgeable as possible about any carrier or one insurance type over another.
At Chicagoland Medicare, we limit the number of Medicare insurance carriers who have access to our clients. We work hard to know the deep inner-workings of each of our Medicare insurance partners which means our agents and our clients aren’t distracted by small, startup Medicare insurance companies who may have a great product for a year or two, then fade into the background and exit the market. We know our Medicare insurance company representatives by name, and know how to navigate their systems and processes.
The bottom line: Chicagoland Medicare is an independent Medicare insurance agency. We are not owned by a Medicare insurance company or by some large, national entity. We’re your local Medicare insurance agency for the Chicago area. This means we only work with hand-selected Medicare insurance companies so that we can provide you with the best Medicare plan for you that’s individualized and personalized. We exist and work ONLY for our clients, unencumbered by having to push just one company’s Medicare insurance products.