The Medicare Part B Late Penalty: How It's Figured and How to Avoid It

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Missing your Medicare Part B sign-up window doesn't cost a one-time late fee. It raises your premium every month, usually for as long as you have Part B. This guide explains how the 10% penalty is figured, which Special Enrollment Periods let you sign up late without paying it, and the forms Social Security wants when you use one.

AT A GLANCE

The penalty: an extra 10% for each full 12-month period you could have had Part B but didn't. It's added to your premium for as long as you have Part B.
2026 standard Part B premium: $202.90 a month. Medicare's example of a 2-year delay comes to $243.50 a month.
Main way to avoid it: the 8-month Special Enrollment Period after job-based coverage (yours or your spouse's) or the job ends, whichever comes first.
No SEP for: COBRA ending, retiree coverage ending, Marketplace coverage, or missing the 8-month window.
Missed every window? The General Enrollment Period runs January 1 to March 31 each year. Coverage starts the month after you sign up.
Social Security: 1-800-772-1213 (TTY 1-800-325-0778).

How the Part B penalty is calculated

Medicare's "Avoid late enrollment penalties" page says you pay an extra 10% for each year you could have signed up for Part B but didn't. The federal rule behind it, 42 CFR 408.22, counts only full twelve-month periods. That means 11 months late adds nothing, while 12 to 23 months adds 10%.

The penalty is a percentage of the standard premium, so it's recalculated when the premium changes each January. Medicare also warns that you may pay a higher premium on top of that depending on your income.

What a late start costs in 2026

Medicare's own example: someone who waited 24 months and had no Special Enrollment Period owes a 20% penalty. That's $202.90 plus $40.58, or $243.48, which Medicare rounds to the nearest 10 cents, so $243.50 a month. The other rows below are our own math using the same method.

Full years without Part B	Penalty	2026 monthly premium (standard)	Extra cost per year
Under 1 year	0%	$202.90	$0
1 full year (12-23 months)	10%	about $223.20	about $243.60
2 full years (24-35 months)	20%	$243.50 (Medicare's example)	about $487.20
3 full years	30%	about $263.80	about $730.80
4 full years	40%	about $284.10	about $974.40

Late enrollment penalties are added to your monthly premium. They're not a one-time late fee, and for most people they last a lifetime.

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The windows that matter

There are three ways into Part B after you first become eligible. Which one you use decides both when coverage starts and whether a penalty applies.

Initial Enrollment Period

For most people this is the 7 months around their 65th birthday: the 3 months before, the birthday month, and the 3 months after. If you sign up before your birthday month, Part B starts the month you turn 65. If you sign up during your birthday month or any of the 3 months after, it starts the following month.

People who already get Social Security or Railroad Retirement benefits get Part A automatically. Medicare.gov says they need to sign up for Part B within 3 months of Part A starting, or risk waiting and paying the penalty.

General Enrollment Period

If you missed your first window and don't qualify for a Special Enrollment Period, you can sign up from January 1 to March 31 in any year. Coverage begins the month after you sign up. This is the route that usually comes with a penalty.

Special Enrollment Periods

These are limited-time windows that let you sign up later without a penalty. Each has a start and end date, and Medicare stresses that if you let one close, you're back to waiting for the General Enrollment Period.

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The working-past-65 Special Enrollment Period

This is the SEP most people use. It applies if you have, or had, group health coverage through your own current job or your spouse's. If you have a disability, it can also apply to coverage through a non-spouse family member's job, but only if that employer has a large group health plan.

Starts: the first month after your Initial Enrollment Period ends.
Ends: 8 months after the group health plan coverage ends or the employment ends, whichever happens first.
Coverage start: generally the month after you sign up. If you sign up while you (or your spouse) are still working, or within the first full month after the job coverage ends, you can ask to delay the Part B start date by up to 3 months.

Social Security's Part B page puts it the same way. If you've been covered by an active employer plan since turning 65 and it ended within the last 8 months, you can enroll with no penalty, and you can apply online any time of year.

What doesn't count as job-based coverage

This is where people get caught. Medicare.gov says COBRA isn't group health plan coverage, and having COBRA doesn't change when your 8-month window ends. Its list of situations that don't qualify for an SEP includes:

Your COBRA or retiree coverage ending
Missing the 8-month window after you stopped working or lost job coverage
Having or losing Marketplace coverage
End-Stage Renal Disease (which has its own rules)

Our example: Dana keeps her employer plan past 65, retires on May 31 and takes 18 months of COBRA. Her 8-month SEP is counted from June, when the job ended, not from when COBRA runs out. If she waits for COBRA to end before signing up, she has missed the SEP. (Hypothetical, based on the Medicare.gov rules above.)

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Other Special Enrollment Periods

Since January 1, 2023, Medicare has also offered "exceptional conditions" SEPs (42 CFR 406.27). Medicare.gov describes them this way:

Your situation	When the SEP runs	How to apply
Lost Medicaid on or after 1/1/2023	From the day you're notified Medicaid is ending until 6 months after it ends	Form CMS-10797 to Social Security
Missed sign-up because of a declared disaster or emergency (on or after 1/1/2023)	From the declaration until 6 months after it ends, including extensions	Form CMS-10797
Got wrong or misleading information from your health plan or employer (on or after 1/1/2023)	6 months from the day you tell Social Security	Form CMS-10797
Released from incarceration on or after 1/1/2023	Until the last day of the 12th month after release	Form CMS-10797. You can ask for coverage back to your release date, up to 6 months back
Other exceptional conditions	At least 6 months from when you contact Social Security	You must contact Social Security first
Volunteering in a foreign country	6 months from when the volunteering, tax-exempt status or overseas coverage ends	Online, or CMS-40B if you already have Part A
TRICARE	12 months from when Social Security notifies you	See Medicare.gov's TRICARE guidance

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How to sign up during the job-based SEP

Confirm your dates. Write down the month your job ended and the month the employer coverage ended. Your window closes 8 months after whichever came first.
Get Form CMS-L564 filled in. This is the "Request for Employment Information." You complete Section A (your name and SSN, plus the employee's name and SSN if the coverage came through a spouse or family member). Your employer completes Section B with coverage and employment dates and signs it.
Add Form CMS-40B. This is the Part B application if you already have Part A.
Submit. Apply online through Social Security's "Sign up for Part B only" page, or fax or mail both forms to your local Social Security office.
Ask about the start date. If you're still working, or within a month of losing coverage, you can request a delayed start of up to 3 months.

The CMS-L564 instructions say "current employment" means actively working, not disability or retirement. If you worked for a railroad, contact the Railroad Retirement Board at 1-877-772-5772 instead.

Before you call Social Security

☐ Your Medicare number, if you already have Part A
☐ The employer's name and address
☐ The CMS-L564 with Section B signed by the employer
☐ The exact month the job ended and the month the coverage ended
☐ For an exceptional-conditions SEP, the documents behind your story (Medicaid end notice, release papers, the plan's letter)

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If you already owe the penalty

Medicare.gov says you generally won't pay a Part B penalty if you qualify for an SEP or if you enroll in a Medicare Savings Program. These state-run programs can pay your Part B premium. For 2026, the federal income limits on Medicare.gov's Medicare Savings Programs page are:

Program	What it pays	Monthly income limit (individual / couple)	Resource limit (individual / couple)
QMB	Part B premium, deductibles, coinsurance (and Part A premium if you pay one)	$1,350 / $1,824	$9,950 / $14,910
SLMB	Part B premium	$1,616 / $2,184	$9,950 / $14,910
QI	Part B premium. You must reapply every year, first come, first served	$1,816 / $2,455	$9,950 / $14,910

The limits are slightly higher in Alaska and Hawaii, and some states set them higher or don't count certain income. Medicare.gov says to apply even if you don't think you qualify.

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Part A and Part D penalties, briefly

Part A: most people get it free. If you have to buy it and don't when you're first eligible, the premium may go up 10%, paid for twice the number of years you went without it. Two years late means four years of the higher premium.
Part D: 1% per month (12% a year) if you go 63 days or more without creditable drug coverage after first getting Medicare. It's figured from the national base beneficiary premium, which is $38.99 in 2026. Medicare's example of 14 months late comes to a $5.50 monthly penalty. Extra Help or creditable coverage generally prevents it.

WHAT TO DO THIS WEEK

If you're 65+ and still on an employer plan, note the date your job or coverage will end. Your 8-month clock starts then.
If you're on COBRA or retiree coverage, check now whether you're still inside your 8-month window, and sign up if you are.
Ask your employer's HR office to complete Section B of Form CMS-L564.
If money is tight, contact your state Medicaid office about a Medicare Savings Program.

Related guides

Official sources

Last checked: October 30, 2026. Penalty rules, 2026 premiums and SEP windows come from Medicare.gov and Social Security. Form details come from the CMS-L564 (09/16 edition).

This is general information, not legal advice. Social Security decides enrollment and penalties. Call 1-800-772-1213 to confirm your own dates.