I get this question a lot as a Medicare Insurance Agent. Medicare has very defined rules regarding a penalty for not obtaining Part B “Medical” and Part D “Drug” coverage at the time you are eligible for Medicare Part A. You are eligible for Medicare either when you turn 65 years old, or having been disabled for 24 months.
Technically speaking, you don’t have to do anything. But if you do nothing when you are eligible, then you may pay for it in the long run. The exception for this rule is if you currently are eligible for Medicare, but have health insurance through your employer.
For example, you feel that you cannot afford or need Medicare Part B which in 2017 will cost approximately $134 per month, if your income is below $85K per year, and Part D may range in cost from $18 through $60 depending on the Private Insurance company that you obtain the drug plan through. Fast forward 5 years later, and you develop a chronic condition which requires medications to manage, or you develop cancer. Once you decide to get back on Part B and Part D, not only will you face a delay in doing so, but the penalty for Part B is 10% for every year, and Part D is 12% for every year you did not have the coverage.
What does that translate to? 5 years of not having Part B will be 50% times (what Part B cost which is $134) or 50% X $134 = $67. You will pay $67 every month for the rest of your life.
5 years of not having Part D will be 60% times (National Average Cost of what Part D cost which is $34.10) or 60% X $34.10 = $20.46. You will pay $20.46 every month for the rest of your life.
These examples are based on 2017 rates and serve as examples only. Please call Medicare or visit the Medicare.gov website for more information.
This information is brought to you by The Medicare Lady, Darlene Swaffar at www.seniormedicalchoices.com.
