It’s well known that healthcare in the United States can be very expensive. For this reason, it’s important to enroll in Medicare during the Initial Enrollment Period, unless you already have other coverage of similar value. Failure to do so may result in an additional fee called a late enrollment penalty. Therefore, it’s important to understand the different phases of enrollment in Medicare Advantage or any other form of health insurance.
It also increases the longer you wait to enroll and is based on how long you go without Medicare-like coverage
What is the late enrollment penalty? It’s added to your monthly premium; it’s not a one-time late payment charge. It’s generally charged for as long as you have that type of coverage (for most, it’s a lifetime penalty). Keep in mind that the penalty for Part A is different. It also increases the longer you wait to enroll and is based on how long you go without Medicare-like coverage. Therefore, it’s important to know when to enroll to avoid penalties.
As people age, they experience health changes that can increase these costs
During retirement, expenses may increase, so avoiding extra costs, such as late fees, is almost essential. This can happen whether you start retirement with a substantial savings cushion or a modest retirement fund, as one of the main expenses is often health insurance. As people age, they experience health changes that can increase these costs. In this regard, it’s important to note that the initial Medicare enrollment period begins three months before your 65th birthday and ends three months after. Therefore, you have seven months to enroll.
It’s important to know your exact situation because, for example, you won’t have to pay a late enrollment penalty for Part B if you enroll during the Special Enrollment Period. You’ll pay an additional 10% for each year you could have enrolled in Part B but didn’t. And in any case, you may also pay a higher premium depending on your income. If you don’t enroll on time, you not only risk losing coverage but also having to pay this 10% surcharge on Part B.
It’s advisable to review your plan options each year during open enrollment
It’s also important to review your enrollment plan. Medicare has an open enrollment period each year that runs from October 15 to December 7. During this time, current Medicare beneficiaries can change their coverage. According to official sources, if you waited two full years (24 months) to enroll in Part B and didn’t qualify for a Special Enrollment Period, you’ll have to pay a 20% late enrollment penalty (10% for every 12 months you could have enrolled), plus the standard monthly Part B premium ($185 in 2025). For this reason, it’s advisable to review your plan options each year during open enrollment, even if you’re happy with your current plan and it’s not going to get worse.
Addressing health problems early could prevent you from accumulating large bills
Knowing all the details is also important to, for example, take advantage of all the free services included in Medicare. There are certain services all Medicare enrollees are entitled to at no cost. These include an annual well visit, certain vaccines, and some screening tests. After joining a Medicare prescription drug plan, the plan will tell you if you have to pay a penalty and what your premium will be. It’s important to read up on your Medicare coverage and figure out which free services you’re entitled to.
And of course, if you have any doubts, always consult official sources, as there are cases where, for example, one disadvantage of Medicare Advantage over Original Medicare is that plan participants are often limited to a specific network of providers. Addressing health problems early could prevent you from accumulating large bills that might arise from dealing with complications due to neglecting your health. Going to providers outside your plan’s network could mean getting less coverage for the services you need, or in some cases, no coverage at all.
