Avoid the Medicare Part D Late Enrollment Penalty

Updated: Sep 14

Medicare Part D - also known as the Medicare prescription drug benefit - is an optional U.S. federal-government program with the purpose of helping seniors on Medicare pay for their prescription drugs. Many seniors who choose Original Medicare, purchase a Part D plan in order to get prescription drug benefits while most Medicare Advantage plans include prescription drug benefits. Beneficiaries pay for the popular program through monthly insurance premiums.

Avoid the Medicare Part D late enrollment penalty


The best way to avoid the Part D late enrollment penalty is to understand what it is, why the fee is assessed and what actions you can take to protect yourself. The following Q & A answers the most common questions.


Q. What is the Medicare Part D late enrollment penalty?


A. The Medicare Part D late enrollment penalty - also called the LEP or “penalty”- is a sum that may be tacked onto an enrollee’s monthly Part D premium.


Q. Why is a person charged the Medicare Part D Late Enrollment Penalty?


A. A person on Medicare who is not enrolled in Medicare Part D or other creditable prescription drug coverage* for any period of 63 consecutive days or more after the end their Initial Enrollment Period for Part D coverage may be at risk for the penalty.


*creditable prescription drug coverage, or “creditable coverage”, is prescription drug coverage that on average pays at least as much as Medicare’s standard prescription drug coverage. Examples are plans from an employer, union, Indian Health Service, or the Department of Veterans Affairs. Most plans that offer prescription drug coverage are required to send their members who are eligible for Medicare Part D a notice each year that compares its coverage to Medicare prescription drug coverage and confirms that it is creditable coverage. Some companies include this information in their employee handbook.


Q. How long will I be charged the Medicare Part D late enrollment penalty?