Medicare Advantage

Late to Medicare in Germantown? Here's How Penalties Work

# Medicare late-enrollment penalties: how they work and how to avoid…

GERMANTOWN, Md. — Signing up for Medicare on time is one of the most important money decisions a new beneficiary makes. Miss your window, and you could pay a penalty every month for as long as you have coverage. The good news: the rules are knowable, and Germantown residents have plenty of options to compare once they're enrolled.

Why late enrollment matters

Medicare has enrollment windows for a reason: the program works best when people sign up when they're first eligible, usually around their 65th birthday. If you delay without a valid reason — like having job-based coverage from a large employer — the penalties can follow you for years.

Two parts of Medicare have well-known late penalties: Part B (doctor visits and outpatient care) and Part D (prescription drugs). Part A is usually premium-free for people who worked and paid Medicare taxes, so most folks don't face a penalty there.

How the Part B penalty works

If you don't enroll in Part B when you're first eligible, your monthly premium can go up 10% for each full 12-month period you could have had Part B but didn't. That extra amount is added to your Part B premium — usually for as long as you have Medicare.

There's an important exception. If you're still working and have health coverage through a current employer (yours or your spouse's) with 20 or more employees, you can generally delay Part B without a penalty. When that job coverage ends, you get an eight-month Special Enrollment Period to sign up.

How the Part D penalty works

The Part D drug-coverage penalty is smaller month to month, but it also lasts as long as you have Part D. It's calculated as roughly 1% of the "national base beneficiary premium" for every full month you went without creditable drug coverage after you were eligible.

"Creditable" means your other drug coverage — say, from a former employer or the VA — is expected to pay at least as much as a standard Medicare Part D plan. If you have creditable coverage, keep the letter that says so. You may need it later to prove you don't owe a penalty.

Key dates to circle

• Initial Enrollment Period: the 7-month window around your 65th birthday (3 months before, your birthday month, and 3 months after).
• General Enrollment Period: Jan. 1 – March 31, for people who missed their initial window.
• Annual Enrollment Period: Oct. 15 – Dec. 7, when you can join, switch, or drop Medicare Advantage and Part D plans.
• Medicare Advantage Open Enrollment: Jan. 1 – March 31, when people already in a Medicare Advantage plan can make one change.

A snapshot of your options in the area

Germantown is in Montgomery County, where Medicare beneficiaries have a wide field to choose from once they're enrolled on time. For 2026, there were 40 Medicare Advantage plans available in the county, offered by 8 carriers. Maryland has 10 stand-alone Part D plans for 2026, sold statewide, so Montgomery County residents on Original Medicare can join any of them — though many people compare drug coverage as part of a Medicare Advantage plan that includes prescriptions (an "MA-PD"). The 2027 lineup is in each plan's ANOC and on Medicare.gov's Plan Finder.

With about 181,139 residents age 65 and older across Montgomery County, comparing plans thoughtfully during the Annual Enrollment Period is worth the effort. Plan counts and star ratings come from the CMS Medicare Advantage and Part D Landscape files.

What's new for 2027 you should know about

Even if you're already enrolled, a few program-level changes matter as you look at 2027 coverage:

• The Part D out-of-pocket cap for covered drugs is $2,100 in 2026.
• The Part D maximum deductible is $615 in 2026 ($700 in 2027).
• The old coverage gap (the "donut hole") was eliminated in 2025, so Part D now has three phases.
• The Medicare Prescription Payment Plan lets you spread your drug costs across the year in monthly installments instead of paying a big amount at the pharmacy counter.
• IRMAA — the income-related surcharge on Part B and Part D — starts above $109,000 in income for a single filer in 2026.

How to avoid a penalty

Mark your calendar with your Initial Enrollment Period well before you turn 65. If you're planning to keep working past 65, ask your employer's benefits office — in writing — whether your coverage counts as creditable and whether you should still enroll in Part A or Part B. If you're losing job coverage, act quickly to use your Special Enrollment Period.

For personalized help, call 1-800-MEDICARE, visit medicare.gov, or contact Maryland's State Health Insurance Assistance Program (SHIP), called SHIP MAP, for free one-on-one counseling. SHIP counselors don't sell plans — they help you understand your choices.