Yes, if you have been without "creditable" prescription drug coverage after you are Medicare eligible, you can be assessed a permanent, late-enrollment premium penalty once you decide to join a stand-alone Medicare Part D prescription drug plan (PDP) or a Medicare Advantage plan that includes prescription drug coverage (MAPD).

In fact, even if you join a Medicare Advantage plan (MAPD) with a $0 premium, you will still pay a Medicare Part D late-enrollment penalty even though you do not actually pay anything for the plan premium.  As noted by Medicare:

"... even if the person decides to join another Medicare drug plan, he or she will still have to pay the penalty once enrolled in a new plan. This also means that if a person joins a plan that has a $0 monthly premium, he or she will still owe a penalty."

The good news: You will not be assessed a late-enrollment penalty if you:

• Qualify for the Medicare Part D Extra Help program or
  
  
• You had some form of creditable prescription drug coverage after he was eligible for Medicare but before joining a Medicare Part D plan (such as VA coverage or TRICARE coverage) or
  
  
• You had creditable prescription drug coverage through your employer health plan or some other source.

As you review the Medicare Advantage plan (MAPD) Evidence of Coverage (EOC) document, you may notice some language such as:

"Chapter 6. What you pay for your Part D prescription drugs

Section 8.1 What is the Part D “late enrollment penalty”?

Note: If you receive “Extra Help” from Medicare to pay for your prescription drugs, you will not pay a late enrollment penalty.
The late enrollment penalty is an amount that is added to you Part D premium. You may owe a late enrollment penalty if at any time after your initial enrollment period is over, there is a period of 63 days or more in a row when you did not have Part D or other creditable prescription drug coverage. “Creditable prescription drug coverage” is coverage that meets Medicare’s minimum standards since it is expected to pay, on average, at least as much as Medicare’s standard prescription drug coverage. The amount of the penalty depends on how long you waited to enroll in a creditable prescription drug coverage plan any time after the end of your initial enrollment period or how many full calendar months you went without creditable prescription drug coverage. You will have to pay this penalty for as long as you have Part D coverage. The late enrollment penalty is added to your monthly premium. When you first enroll in [this Medicare Advantage plan], we let you know the amount of the penalty.

Your late enrollment penalty is considered part of your plan premium. If you do not pay your late enrollment penalty, you could lose your prescription drug benefits for failure to pay your plan premium."

As a reminder:  "Creditable prescription drug coverage" is drug coverage that is at least as good as a Medicare Part D plan and does NOT include:

• prescription drug discount cards,
• free clinics, and
• drug discount websites

For more information: Our Q1Medicare Late-enrollment Penalty Articles

For more information, you can review our recent articles detailing the late-enrollment penalty.

Our Q1Medicare Late-enrollment Penalty Frequently Asked Questions (FAQs)

You can also to review more of our Frequently Asked Question (FAQ) regarding the Medicare Part D late-enrollment penalty.