Dear Toni:
My husband lost his job June 2013 and we are now enrolling in Part B of Medicare because COBRA’s is almost over…Now I am finding out that there will be a penalty for us not enrolling when we should have. No one has ever told us when the time limit is and I have never received a Medicare & You handbook. Didn’t know the rules were in it until I began reading your column.
We are now 70 years old and the penalty for us is each 50% because it is 5 years since we were 65.
Please let your readers know how important it is to enroll at the correct time. . Robert from Katy, TX
Hello Robert:
You are right that people should not wait to enroll in Part B! As you very well know that these penalties can be very costly and that penalty will last until you pass away or are no longer on Medicare.
Social Security keeps track of your records and when you are past 65 and have delayed your Part B. Then you must get your company HR department to sign off on Social Security form “Request for Employment Information”. If your company does not sign off on the form, you can receive a 10% penalty for every 12 month period that you could have been on Medicare Part B, but failed to enroll.
Always, make sure that your Part B begins the day you lose your company benefits or the day your COBRA plan starts. See pages 26-27 of the 2015 Medicare & You handbook on “Should I get Part B?”, when you were first eligible and what the late penalties are.
Many think the Part B rule starts when COBRA ends in18 months. They are not aware that the Special Enrollment Period begins the month they lose their company benefits or employment ends and go on COBRA.
They enroll in Part B with a BIG SURPRISE like you have Robert….they find they are penalized 10% each year or 12 month period, you could have had Part B, but didn’t. The penalty goes all the way back to the day he/she turned 65 or the day Part A began.
All of the arguing with Social Security won’t help, it’s the rule.
I have a client in Wharton, TX, 79 years old and has always been on his wife’s company health plan. He never enrolled in Part B because she was the “working spouse”, but she lost her job … She was 62 and because she had health issues and the cost of COBRA was less than an individual health plan, she enrolled herself and her 79 year old husband in COBRA. When COBRA ended 18months later, they went to Social Security to enroll him in Part B and were shocked!!! His premium for Part B was not $104.90. It was $104.90 plus $146.86 penalty for late enrollment for a total of $251.76 per month. This is a 140% penalty (14 years x 10%) each month for the rest of his Medicare life. You say, “Toni, how can this be?” And here is the answer… He did not enroll in “Part B” at the right time!
My advice is always have Part B in place when leaving your job or losing your company benefits.
You must get this right the first time! There might not be a second chance!
Toni King, author of the new Medicare Survival Guide®, which is a simple guide that puts Medicare in people terms, is on sale at www.tonisays.com. Email questions or to schedule a “Confused about Social Security and Medicare Workshop” to www.tonisays.com/ask-toni
or call 832/519-TONI (8664).
