How to Avoid the Medicare Part D Penalty

Hello Toni,

I read your article about how ignoring Medicare rules is costing Americans millions. Sadly, I believe I’ve made a mistake. I have not enrolled in a Medicare Part D prescription drug plan and need your help.

I retired in August and had a telemarketing agent help me find a Medicare Supplement that began on September 1st. No one told me that I had a specific amount of time to enroll in my Medicare Part D plan. Currently, my prescriptions are generic, and I use GoodRx to receive the discount. 

When I enrolled on December 15 for a new Medicare Part D plan, I was denied because I didn’t apply on time. I’m 70, and my Part D will begin next year when I’m 71. Medicare informed me that the Part D penalty will be $.3470 times 72 months since my Medicare Part A began 6 years ago at 65. I’m disheartened that I must pay an extra $25 per month as a Part D “penalty”. 

Please explain this ridiculous Medicare Part D rule and when I can begin my plan.

Thank you,
Samuel from Chattanooga, TN

Samuel,

You will have to wait until the next Medicare Annual Enrollment period, which runs from October 15th through December 7th, to enroll in a Medicare Part D plan. Your effective date will be January 1, 2025. The good news is that you are currently taking generics. This means, that you can use GoodRx (which is not what Medicare deems as a “creditable” prescription drug plan) until you enroll in Medicare Part D during that time.

More on Medicare Part D

Once you’re past 65 and leaving creditable employer’s group coverage with a prescription drug plan, Medicare gives you only 63 days to enroll in Medicare Part D or a Medicare Advantage plan with prescription drug coverage.

Your Late Enrollment Period (LEP) did not begin from the day you left your company health plan, nor from your Medicare Part B start date. It began from the month your Medicare Part A began.

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Medicare Part D plays an essential role in supporting those who depend on prescription medications to address their health conditions. However, the unpredictability of health challenges means that new prescription needs may also arise unexpectedly. That’s why it’s important to consider a Part D plan. With Part D, you have the peace of mind knowing that you’ll be financially supported when it comes to your prescription needs, both current and future.

Choosing a Medicare Part D plan using Medicare.gov‘s online tools can be a helpful and efficient way to find the right coverage for your prescription drug needs.

Start by gathering your information.

• Make a list of your current prescription drugs, including dosages and frequencies.
• Note any preferred pharmacies or providers you would like to use.
• Consider your budget and desired level of coverage.

Visit the Medicare Plan Finder on Medicare.gov.

• Go to www.medicare.gov.
• In the navigation, scroll over “Health & Drug Plans.”
• Click “Drug Coverage (Part D)

• Enter your ZIP code and follow the prompts to provide additional personal information.

Enter your prescription drugs.

• On the Medicare Plan Finder, select the option to enter your medications.
• Type in the names of your prescription drugs and follow the prompts to provide details such as dosages and frequencies.
• If you’re unsure about a specific medication, you can skip it or consult with your healthcare provider for accurate information.

Compare available plans.

• After entering your medications, the Medicare Plan Finder will generate a list of available Part D plans in your area.
• Use the filtering options to narrow down the results based on factors like premium costs, deductible amounts, and copayments.
• Pay attention to the estimated annual costs and the coverage details provided for each plan.

Review plan details and make your selection.

• Click on individual plan options to review the specific details, benefits, and restrictions.
• Consider factors such as formulary coverage (ensuring your medications are covered), preferred pharmacies, and any utilization management requirements.
• Compare the total estimated annual costs, including premiums, deductibles, copayments, and coinsurance, to find a plan that aligns with your budget and coverage needs.

The Late Enrollment Period Penalty

The LEP (Late Enrollment Period) penalty for Medicare Part D can be charged to you because:

1. You waited 63 days without creditable prescription drug coverage upon leaving company benefits and are older than 65 years and 90 days.

2. Your company’s prescription drug benefits (not health insurance) were not “creditable” as Medicare declares.

Click HERE to find out more about “creditable” prescription drugs.

3. You never enrolled in Medicare Part D at the time you enrolled in Medicare Part A and Part B when you turned 65, and now want to enroll. 

Samuel, you were denied Medicare Part D prescription coverage because you met Medicare’s LEP (late enrollment penalty) rule. Unfortunately, you will receive the Part D penalty when you enroll during Medicare’s Annual Enrollment period. This penalty will last a lifetime.

Americans who plan to retire after 65, who are leaving their employer’s health plans and applying for Medicare Parts A and B, must also prove they have “creditable coverage” when applying for a Medicare Part D prescription drug plan. This is a Medicare rule. Don’t delay your Part D enrollment!

More from Toni King

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Medicare Survival Guide Advanced Edition

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What You Don’t Know Will Hurt You!

Turning 65 in America is a milestone and one of the markers is enrolling in Medicare. But the system is so complicated, and there is a lot of false information out there.

In Toni King’s Medicare Survival Guide Advanced: Basics and Beyond, Toni gives you the critical steps you need to enroll in Medicare properly. Toni shares various situations that she has experienced with her many clients during Medicare consultations, and gives you the information and tools you need to enroll on time to avoid the “famous” Medicare Part B and D penalties.

Medicare Survival Guide Advanced helps you understand Medicare step by step…

Learn How to Enroll the Correct Way
• Still Working Past 65
• Turning 65
• VA Benefits
• Laid-off or Retiring

What Medicare Option Is Best for You
• Medicare Supplement vs. Advantage
• Losing Retirement Benefits

How to Avoid
• The Donut Hole
• Part B Penalties
• Part D IRMAA Penalties

If you are enrolling in Medicare and are confused by the commercials and telemarketers, or from the information that well-meaning friends or family members give, let Toni guide you through the maze of Medicare. Order TODAY!