The Medicare Part B late enrollment penalty is 10% of the standard premium for each full 12-month period you could have had Part B and did not. It is added to your monthly premium and, in most cases, you pay it for as long as you have Part B.
It is not a one-time fine. On a standard 2026 Part B premium of $202.90, a two-year delay adds about $40 a month, permanently.
The good news is that most people who think they owe a penalty do not, because a Special Enrollment Period covered them.
How the penalty math works
Count the number of full 12-month periods between when your Part B eligibility began and when your coverage actually started. Partial years are dropped, not prorated.
| Full years late | Penalty | Added to a $202.90 premium |
|---|---|---|
| Under 1 year | 0% | $0 |
| 1 year | 10% | about $20 |
| 2 years | 20% | about $41 |
| 3 years | 30% | about $61 |
| 5 years | 50% | about $101 |
The penalty is calculated against the standard premium each year, so it rises as the standard premium rises. If you also pay an income-related adjustment, the penalty is applied to the standard amount, not to your adjusted amount.
The base figure comes from the 2026 Part B standard premium.
Who actually owes it
You owe the penalty if you had no creditable coverage and skipped your Initial Enrollment Period — the seven months centered on the month you turn 65.
You generally do not owe it if any of these applied:
- You or your spouse were still working and you had group health coverage from that employer. This is the big exception. It gives you a Special Enrollment Period of 8 months after the employment or the group coverage ends, whichever comes first.
- You had Medicare Part A only while covered by an employer plan and enrolled in Part B during that Special Enrollment Period.
- You were covered by TRICARE, the VA, or the Federal Employees Health Benefits program — though these have their own coordination rules and the VA specifically does not eliminate the Part B penalty, so check before relying on it.
- You have Medicaid or a Medicare Savings Program paying your premium; the penalty is generally not charged while a state pays.
- You qualify for a Special Enrollment Period for an exceptional circumstance, such as a natural disaster, incarceration, loss of Medicaid, or misinformation from a health plan or federal employee.
Coverage that does not count as creditable for Part B: COBRA, retiree coverage from a former employer, and Marketplace plans. This trips up a large number of people every year. COBRA in particular feels like employer coverage and is not treated as such — the Special Enrollment Period clock starts when the active employment ends, not when COBRA ends.
The employer-coverage exception, in practice
To use it you need to document that you had group coverage based on current employment. Two forms do this:
- CMS-40B — Application for Enrollment in Medicare Part B.
- CMS-L564 — Request for Employment Information, completed by the employer, confirming the dates of group coverage.
Submit both together. If the employer is out of business or will not complete the form, submit the CMS-40B with alternative proof: pay stubs showing health premium deductions, W-2s showing employer contributions, the health insurance card with dates, or an insurer letter.
The Special Enrollment Period runs 8 months from the end of employment or the end of the group coverage, whichever comes first. Missing it drops you into the General Enrollment Period.
If you missed everything: the General Enrollment Period
The General Enrollment Period runs January 1 through March 31 each year. Coverage now begins the first day of the month after you enroll, which is a meaningful improvement over the old rule that made people wait until July.
You will still be assessed the penalty for the full years you were late, but the gap in coverage is much shorter than it used to be.
The Medicare enrollment periods overview lays out how the windows fit together.
Can the penalty be removed?
Sometimes, through equitable relief. SSA can waive or reduce a penalty and adjust your enrollment date if you can show you were misled by a federal employee, a Medicare representative, an agent, or in some cases a health plan or employer.
To request it:
- Write to SSA describing what you were told, by whom, and when. Specificity matters — a name, a date, a phone call log.
- Attach any documentation: letters, plan materials, emails, notes taken at the time.
- State clearly what you are asking for — removal of the penalty, a corrected enrollment date, or both.
- Submit it to your local SSA office and keep a copy.
Equitable relief has no formal application form and no filing deadline, which also means there is no guaranteed timeline. It is worth pursuing when the facts are genuinely on your side.
There is also a separate route for people who dropped Part B while covered by employer insurance and are simply re-enrolling within their Special Enrollment Period — that is not a penalty case at all, just a normal enrollment.
Part B vs. Part D penalties
They are different formulas and people mix them up.
| Part B | Part D | |
|---|---|---|
| Rate | 10% per full 12 months late | 1% of the national base beneficiary premium per full month without creditable drug coverage |
| Duration | Generally for life | Generally for life |
| Creditable coverage | Group health from current employment | Any drug coverage at least as good as Part D |
| Waived by low-income help | Yes, if a state pays your premium | Yes, Extra Help eliminates the Part D penalty |
FAQ
Does the penalty ever go away on its own?
For most people, no. Two exceptions: if you qualify for a Medicare Savings Program or Extra Help, and in a narrow case for people who first got Medicare through disability and then age back in at 65, which resets the calculation.
I am 67 and still working with employer coverage. Should I take Part B now?
If the employer has 20 or more employees, the group plan generally pays first and delaying Part B is usually safe. Under 20 employees, Medicare usually pays first and delaying can leave you badly exposed. Confirm with the plan’s benefits administrator in writing.
Does an HSA change this?
Yes. You cannot contribute to a health savings account once Medicare starts, and Part A enrollment can be retroactive up to six months. Stop HSA contributions well before enrolling.
Can I appeal the penalty amount?
You can request reconsideration if you believe the count of late months is wrong. Equitable relief is the route if the count is right but you were misinformed.
Where do I check my premium and penalty?
Your Medicare premium bill or your Social Security benefit statement itemizes them. Your online account at medicare.gov also shows current enrollment dates.
As of August 2026. Premium figures reflect the 2026 standard Part B premium; penalty percentages are set in federal law. Verify your own amounts with SSA or Medicare. Official information: medicare.gov.