"Not taking Medicare" can mean skipping Part A, Part B, Part D, or all three. The outcome depends on whether you're still working, what insurance you already have, and whether your drug coverage is "creditable."
This guide covers the Initial Enrollment Period, penalties by part, when you can delay safely, and what to do if you've already missed a deadline. Always confirm your own situation with Medicare.gov or Social Security (1-800-772-1213) before declining coverage.
Key Takeaways
- Turning 65 doesn't force everyone to enroll, but delaying without qualifying coverage costs money.
- Parts A, B, and D each have their own penalty formula and duration.
- Active employer coverage can protect a Part B delay. COBRA and retiree plans generally don't.
- Check HSA contributions and drug coverage before delaying.
What Happens If You Don't Take Medicare at 65?
Your Initial Enrollment Period
Your Initial Enrollment Period (IEP) lasts 7 months: three months before your birthday month, the birthday month, and three months after. Your enrollment timing affects your start date. Sign up before your birthday month and Part B coverage starts the month you turn 65. Sign up during or after that month and it starts the following month.
What Happens After It Closes
Miss the IEP without a Special Enrollment Period (SEP) and you generally wait for the General Enrollment Period, January 1 to March 31. Coverage then starts the month after you enroll. In the meantime, you may have no coverage, and penalties may apply.
The Real Risk of Having Nothing
Without Medicare or other qualifying insurance, you're exposed to medical bills and delayed care. Even with an employer plan, going without Medicare can leave claims unpaid.
Medicare generally pays first when an employer has fewer than 20 employees, while the employer plan generally pays first at 20 or more. If Medicare should be primary and you don't have it, you can be stuck with large unpaid costs.
Automatic Versus Manual Enrollment
- If you receive Social Security or Railroad Retirement benefits at least 4 months before 65, you're generally enrolled in Parts A and B automatically.
- If you aren't receiving benefits, you must apply.
- Check your Medicare card, which lists Part A, Part B, or both with effective dates. A benefit-verification letter from my Social Security also works.
Delaying Versus Declining
Delaying because you have qualifying active employer coverage differs from simply declining Medicare with nothing behind it. The first can avoid penalties and keep claims paid. The second often can't.
How Medicare Late Enrollment Penalties Work
| Part | Penalty | How long |
|---|---|---|
| A (premium-paying only) | 10% higher premium | Twice the years you delayed |
| B | 10% of the standard premium for each full 12 months eligible but not enrolled | Generally for life |
| D | 1% of the national base premium for each full uncovered month, after 63+ days without creditable coverage | Generally as long as you have drug coverage |
These details come from Medicare's penalty guidance.
Part A
Most people get premium-free Part A with 40 quarters of work, including through a spouse's record. No premium means no penalty. If you owe a premium, a two-year delay means a surcharge for four years. The 2026 premium is $311/month with 30 to 39 quarters and $565/month with fewer than 30.
Part B
The standard 2026 premium is $202.90/month, with a $283 annual deductible. Two full years of delay adds 20%, bringing Medicare's example total to $243.50/month. The penalty is added to your premium for as long as you have Part B.
Don't confuse this with IRMAA, an income-related surcharge based on your 2024 income. It isn't a late penalty. In 2026, individuals above $109,000 (couples above $218,000) pay more.
Part D
The 2026 national base premium is $38.99. Example: 17 uncovered months equals 17% of $38.99, rounded to $6.60/month. That's added to whatever plan you choose, even a $0-premium plan. If you get Extra Help, no Part D late penalty applies.
Medicare Advantage
Advantage (Part C) isn't a separate penalty category. It's a private-plan way to get Medicare, and it requires Parts A and B. Any Part B or Part D penalty still follows you.
When You Can Delay Medicare Without a Penalty
Active employer coverage
Coverage through your own or your spouse's current employment lets you delay Part B. Retiree coverage or coverage that continues only after the job ends doesn't count. The employment SEP applies at any employer size.
The 20-employee rule only decides who pays first. Don't treat it as a test for SEP eligibility.
Special Enrollment Period
You can enroll in Part B while covered through work, or within 8 months after employment or coverage ends, whichever ends first. Coverage generally starts the next month.
You'll typically need two forms:
- CMS-40B, the Part B application
- CMS-L564, which your employer completes to document your coverage
Other coverage types
| Coverage | Part B effect |
|---|---|
| COBRA | Not current-employment coverage; doesn't extend the SEP |
| Retiree plan | No SEP; may exclude costs Medicare should cover |
| Marketplace | Individual coverage; delay can trigger penalties |
| VA | Doesn't automatically create a SEP when it ends |
| TRICARE | TRICARE For Life requires Parts A and B |
Creditable drug coverage
Drug coverage is creditable if it's expected to pay at least as much, on average, as standard Medicare drug coverage. Plans must send written notices every year before October 15. Keep them. They're your proof if Medicare ever questions a gap.
Part B's 8-month window doesn't extend the Part D deadline. VA and TRICARE drug coverage is creditable.
HSA considerations
Once Medicare coverage begins, your HSA contribution limit drops to zero. Part A can backdate up to 6 months, and contributions in those retroactive months become excess contributions, per IRS Publication 969. Stop contributing at least 6 months before applying, and talk to a tax professional.
Before delaying, compare premiums, deductibles, networks, drug coverage, employer contributions, and out-of-pocket costs side by side.
What to Do If You Missed Medicare Enrollment
Work through this checklist:
- Identify which part you delayed.
- List all current and prior coverage with dates.
- Confirm whether that coverage was active and creditable.
- Check whether a SEP applies.
Choosing your enrollment route
- Employment SEP: If you already have Part A, apply through Social Security's online Part B SEP application, or send CMS-40B plus CMS-L564 to Social Security.
- No SEP: Enroll during January 1 to March 31. Enrolling doesn't erase an applicable penalty.
- Premium-free Part A: Apply through Social Security. Coverage can backdate up to 6 months.
Disputing a penalty
For a Part B penalty, follow the notice instructions and request reconsideration from Social Security, online or with Form SSA-561.
For Part D, submit the reconsideration form within 60 days of the date on the penalty letter, and keep paying while it's decided.
Relief isn't guaranteed. Hardship alone isn't enough, though equitable relief may apply when documented government error affected your enrollment.
Muneris Benefits' licensed agents help individuals transitioning to Medicare review their coverage questions and options in Virginia and West Virginia. They aren't affiliated with the government and can't guarantee a penalty will be removed.
Frequently Asked Questions
How much will Medicare cost in 2026?
Part A is $0, $311, or $565 monthly depending on work history. Part B is $202.90 with a $283 deductible, and income-related surcharges may apply. Part D, Advantage, and Medigap costs vary by plan and location.
What is the penalty for late enrollment in Part D Medicare?
It's 1% of the $38.99 national base premium for each full month you lacked Part D or creditable drug coverage, rounded to the nearest $0.10. Extra Help recipients owe no penalty.
What happens if you don't have Medicare?
You may face gaps in health and drug coverage, a delayed start date, unpaid claims, and lifelong penalties. Qualifying employer coverage can change that outcome.
Can I delay Medicare if I am still working at 65?
Often yes for Part B, if you have current-employment coverage. Part D needs creditable drug coverage, and an HSA may be affected.
How do I avoid Medicare late enrollment penalties?
Enroll during your IEP or a qualifying SEP, and keep proof of creditable coverage. Confirm deadlines with Medicare or Social Security before delaying.
