Medicare and the Famous Penalties
One of the more common phrases we hear from people that are newly signing up for Medicare is, "I'm not sure how any of this works... but I do know that I need to sign up for something, or i'll be penalized".
Sound familiar? Well, you are not alone!
Suprisingly, penalties associated with Medicare actually only happen to a small percentage of Medicare beneficiaries. And, we are confident that after searching the Vault or in speaking with our team, you will be able to avoid the dreaded penalties!
With that being said, read below to learn exactly what we are talking about.
Medicare Part B Penalty
Yes, you can receive a penalty if you do not enroll into Medicare Part B health insurance properly.
Yet again, this is why we recommend a phone call to our team. You may be surprised to learn that the penalty does not affect the majority of persons applying for Part B.
However, the Part B penalty certainly has a big and bad reputation and people are very concerned about being penalized. And, rightly so.
Not understanding how the penalty works does cause people to enroll into Medicare at inappropriate times. This can lead to overpayment of premiums and implications to pre-existing conditions that you may have regarding your health. (pre-existing issues are another topic).
If you are indeed assessed a penalty for late enrollment into Part B, that penalty is 10% for every twelve months that you did not have Part B in place.
Important: This penalty is not like a parking ticket where you pay the fee and move on. You retain the penalty every month for the rest of your life.
Call us so that we can help you avoid that.
Medicare Part D Penalty
Because purchase a Medicare Part D plan is technically “optional”, we come across a fair amount of people that have not secured a plan for various reasons.
People taking no medications as they enroll into the Medicare system sometimes feel that they don’t need to purchase a Part D plan.
Let's show you why we always recommend purchasing a Part D plan.
Let’s say that you enrolled in Medicare at age 65 and are now age 68. You did not purchase a Part D plan. You are prescribed a pricey medication in May. You need a Part D plan. You cannot purchase a Part D plan until the fall of that year and the plan will begin in January. You have 7 months with zero drug coverage. We have seen medications that cost as high as $250k a year for one daily pill.
When this person does file for a Part D plan, they will also incur a penalty that is 1% of every month that you did not have a Part D plan in place. As in Part B penalties, this will stay with the person for life, as well.
Our advice? Purchase a Part D plan when you are signing up for Medicare. Note: certain situations affect this decision as well. Do you have VA coverage? Medicaid? **Every point can’t be encapsulated into a paragraph; so, per usual, call our advisors!
Medicare & You 2019 Part D Penalty