The Part B Late Enrollment Penalty: How It Works and How to Avoid It

The Part B late enrollment penalty adds 10% to your monthly Part B premium for each full 12 months you could have had Part B but did not sign up. In most cases you pay it for as long as you have Part B. In 2026, each 10% adds about $20.29 a month.

Key takeaways

• The penalty is 10% of the standard Part B premium for each full 12-month period you went without Part B when you could have had it.
• In 2026, the standard Part B premium is $202.90 a month, so each 10% is about $20.29 a month. The premium is set each year.
• Health coverage from a job you or your spouse still hold usually lets you delay Part B with no penalty.
• COBRA, retiree coverage, Marketplace plans and VA health care do not count as coverage that lets you delay Part B.

What is the Part B late penalty?

Part B is the part of Medicare that pays for doctor visits, outpatient care, lab tests and many preventive services. Most people pay a monthly premium for it. In 2026, the standard Part B premium is $202.90 a month, and the yearly deductible is $283. Both are set each year.

Medicare expects you to sign up for Part B when you first qualify, unless you have certain other coverage. If you wait without that coverage, Medicare adds a late enrollment penalty to your premium. The penalty is not a one-time fee. It is added to every monthly premium.

In most cases, the penalty lasts for as long as you have Part B. That can mean many years of higher bills. Knowing the rules ahead of time lets you plan around it.

Your first chance to sign up is your Initial Enrollment Period. It lasts 7 months: the 3 months before your 65th birthday month, the birthday month, and the 3 months after. Our article on your Initial Enrollment Period explains how coverage start dates work in that window.

How is the penalty calculated?

Medicare counts the months from the end of your Initial Enrollment Period to the month your Part B sign-up takes place. Months when you had job-based coverage that lets you delay do not count. Medicare then counts only full 12-month periods in that stretch.

Each full 12-month period adds 10% to your premium. A gap of 11 months adds nothing, because it is not a full 12 months. A gap of 29 months adds 20%, because it holds two full 12-month periods. The extra 5 months do not count.

The penalty is figured on the standard Part B premium. That holds true even if you pay a higher premium because of your income. IRMAA (an extra monthly charge for higher incomes) is a separate amount and does not change the penalty percentage.

Because the standard premium is set each year, the dollar amount of the penalty can change each year too. The percentage stays the same. CMS has not yet announced the 2027 Part B premium or deductible, so the 2027 dollar amount is not yet known.

How much does the penalty cost in dollars?

Here is a worked case using the 2026 standard premium of $202.90 a month. Someone who waited 29 months without qualifying coverage has two full 12-month periods. That is a 20% penalty, which is about $40.58 more each month in 2026.

Their total Part B premium in 2026 would be about $243.48 a month instead of $202.90. Over the 12 months of 2026, the penalty alone adds up to about $486.96. That amount repeats each year, based on that year's premium.

A longer wait adds more. Three full years without Part B means a 30% penalty, about $60.87 a month in 2026. Five full years means 50%, about $101.45 a month in 2026.

The penalty is added to the premium you pay, whether it comes out of your Social Security check or you pay Medicare directly. You will see the higher amount on your yearly Social Security notice or your Medicare premium bill. The extra charge is listed as part of your Part B premium, not as a separate fine.

Who has to pay the Part B penalty?

You may owe the penalty if you did not sign up for Part B during your Initial Enrollment Period and did not have qualifying coverage. It also applies if your job-based coverage ended and you missed the 8-month window to sign up after it.

A common case is someone who retired before 65 and kept retiree health coverage from a former employer. Retiree coverage is not based on current work, so it does not let you delay Part B. Another common case is someone on COBRA (job-based coverage you keep paying for after you leave a job).

People who drop Part B on purpose can also face a penalty later. If you drop Part B and then sign up again, the months without Part B can count toward a penalty. That is true unless you had qualifying job-based coverage in those months.

People with Marketplace coverage, bought through HealthCare.gov or a state exchange, can face the penalty too. Marketplace coverage does not count as coverage that lets you delay Part B once you have Medicare.

Who does not pay the penalty?

If you or your spouse still work and you have group health coverage from that job, you can usually delay Part B. When the job or the coverage ends, you get a Special Enrollment Period. It lasts 8 months and starts the month after the job or coverage ends, whichever comes first.

People under 65 who get Medicare because of a disability get a fresh start at 65. If they paid a Part B penalty before 65, it stops once they reach 65 and get a new Initial Enrollment Period.

People who qualify for a Medicare Savings Program (state help paying Medicare costs, such as the Part B premium) generally do not pay the Part B penalty. If you get this help, the state pays your Part B premium, and the penalty is not charged.

Since January 1, 2023, Medicare also offers special windows for exceptional conditions. These include a disaster or emergency that kept you from signing up, or wrong information from an employer. Signing up in one of these windows avoids the penalty.

Which coverage lets you delay Part B?

Only coverage tied to current work, yours or your spouse's, lets you put off Part B without a penalty. Every other kind of coverage in this table leaves the penalty clock running.

One more detail matters at small companies. If your employer has fewer than 20 workers, Medicare usually pays first and the job plan pays second. In that case, the job plan may expect you to have Part B, even though the penalty rule itself is about current work.

How do you sign up after job coverage ends?

When your job or job-based coverage ends, your 8-month window opens the next month. You sign up through Social Security, online at ssa.gov, by phone or at a local office. Your Part B coverage starts the first day of the month after you sign up.

You need two forms. Form CMS-40B is the Part B application. Form CMS-L564 is filled out by your employer, or you, to show you had job-based coverage. If your employer cannot complete it, other proof such as pay stubs or tax forms can help.

It helps to sign up before your job coverage ends, so Part B starts the day after it stops. Our step-by-step guide to signing up for Medicare walks through each form and where to send it.

COBRA does not extend the 8-month window. If you choose COBRA, the 8 months still start after the job or job coverage ends. Signing up for Part B within those 8 months keeps you clear of the penalty.

What if you already missed your window?

If you missed your Initial Enrollment Period and do not qualify for a special window, you can sign up in the General Enrollment Period. It runs from January 1 to March 31 each year. Your coverage starts the first day of the month after you sign up.

For example, if you sign up on February 10, your Part B coverage starts March 1. This rule has applied since January 1, 2023. The old rule that made people wait until July 1 no longer applies.

Signing up sooner keeps the penalty from growing. Each extra full 12 months without Part B adds another 10% to the premium. Signing up in the next General Enrollment Period stops the count at that point.

Before you use the General Enrollment Period, check whether an exceptional-condition window fits your case. Medicare.gov lists each one, and 1-800-MEDICARE can confirm whether yours applies.

How is Part B different from Part D?

Part D, Medicare drug coverage, has its own late enrollment penalty with different math. It is 1% of the national base beneficiary premium for each full month without creditable drug coverage (drug coverage at least as good as Medicare's). That base premium is $38.99 in 2026 and $41.33 in 2027.

For example, 14 months without creditable drug coverage means 14% of $41.33 in 2027. That is $5.79, rounded to $5.80 a month in 2027. People who get Extra Help, a program that lowers drug costs for people with limited income, pay no Part D late penalty.

The two penalties are counted on their own. You can owe one, both or neither. Our article on avoiding Part D late enrollment penalties covers the drug side in more detail.

One sign-up step can help with both. When you leave a job, check the date your job drug coverage ends as well as your health coverage. Part D allows 63 days in a row without creditable drug coverage, which is a much shorter window than the 8 months for Part B.

Can you question a penalty you think is wrong?

Yes. If you think Medicare counted your months wrong, you can ask for a review of the decision. The letter that tells you about the penalty explains how to ask and the time limit to do it.

A review can help when you had job-based coverage that was not counted. Proof such as a completed Form CMS-L564, pay stubs or plan records showing your coverage dates supports your case.

Your State Health Insurance Assistance Program can also help you read the letter and gather records. Medicare.gov and 1-800-MEDICARE (1-800-633-4227) explain the review process as well.

If the review finds that months were counted wrong, the penalty can be lowered or removed. Keep copies of every form and letter you send, with the date you sent it.

Have questions? Call 1-877-443-3251 to talk it through with a licensed insurance agent. You never pay the agent; the plans they represent do, and the decision stays yours.

We do not offer every plan available in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options. Medicare has neither reviewed nor endorsed this information.