If you sign up for Part B late and don't qualify for a Special Enrollment Period, your monthly premium goes up. The increase usually stays for as long as you have Part B. Here's exactly how Social Security counts it, with examples using the 2026 standard premium of $202.90 (CMS).
The basic rule
- The standard premium goes up 10% for each full 12 months you could have had Part B but didn't (42 CFR 408.22; POMS HI 01001.010).
- It's added to your monthly premium. It's not a one-time fee. For most people it lasts a lifetime (Medicare.gov).
- The percentage stays the same, but the dollar amount rises when the standard premium rises.
- The total premium is rounded to the nearest dime. Five to nine cents rounds up.
- Generally there's no penalty if you qualify for a Special Enrollment Period. There's also none if you sign up through an "exceptional conditions" Special Enrollment Period.
Which months count
For people signing up for the first time on or after January 1, 2023, Social Security counts the months after your Initial Enrollment Period ends, through the end of the month you sign up (POMS HI 01001.010). Note that the count stops at the month you sign up, not the month coverage starts.
| Left out of the count | Counted |
|---|---|
| Months in your Initial Enrollment Period, and months before 65 | Months on COBRA |
| Months at 65 or older on a group health plan through your or your spouse's current job, at any employer size (POMS HI 00805.280) | Months on retiree coverage |
| Months you had Part B | Months on Marketplace or other individual coverage, or with no coverage |
Then divide the countable months by 12 and drop the remainder. That's the number of 10% steps. 11 months is 0%. 23 months is 10%. 24 months is 20%.
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Example 1: No job coverage after 65
Pat turned 65 in April 2024, so her Initial Enrollment Period ran January through July 2024. She had individual coverage, not coverage from a job, and skipped Part B. She signs up in the General Enrollment Period in February 2027, and Part B starts March 2027.
- Countable months: August 2024 through February 2027 = 31 months.
- Full 12-month periods: 2. Penalty: 20%.
- At the 2026 rate, the math is the same as Medicare.gov's own 20% example: $202.90 + $40.58 = $243.48, rounded to $243.50 a month.
In later years, she pays 20% on top of whatever the standard premium is that year.
Example 2: Worked past 65, missed the window by a little
Ray also turned 65 in April 2024. He stayed on his employer's plan while working. His job and coverage ended in March 2026, so his Special Enrollment Period ran April through November 2026, with a last day of November 30, 2026. He missed it. He signs up in January 2027, and Part B starts February 2027.
- Months after his Initial Enrollment Period, through January 2027: 30.
- Minus August 2024 through March 2026 on his employer's plan while working: 20.
- Countable months: 10. Full 12-month periods: 0. Penalty: none.
Ray avoided a penalty, but he went from April 2026 through January 2027 without Part B, and he couldn't sign up until January. Missing the window doesn't always mean a penalty. It does mean months without Part B.
Example 3: Waited for COBRA to run out
Linda turned 65 in June 2024 (Initial Enrollment Period March through September 2024). Her job and employee coverage ended in September 2025. She took COBRA through March 2027 and signed up in the General Enrollment Period in March 2027. Part B started April 2027.
- Her months on the employer plan while working (October 2024 through September 2025) are left out.
- Her COBRA months count: October 2025 through March 2027 = 18 months.
- Full 12-month periods: 1. Penalty: 10%. At the 2026 rate: $202.90 + $20.29 = $223.19, rounded to $223.20 a month.
More on this trap in COBRA and Medicare Part B.
| Example | Countable months | Penalty | Monthly premium at 2026 rate |
|---|---|---|---|
| Pat, no job coverage | 31 | 20% | $243.50 |
| Ray, missed the window | 10 | 0% | $202.90 |
| Linda, stayed on COBRA | 18 | 10% | $223.20 |
Already paying a penalty? Ask to have covered months removed
There's no deadline for this
Social Security's manual says there is no time limit for asking to remove months when you had job-based coverage from current work. The penalty can be reduced or erased even if you couldn't use the Special Enrollment Period (POMS HI 00805.280).
Social Security's own example: Norma retired in July 2023. She couldn't use the Special Enrollment Period, so she signed up for Part B in the General Enrollment Period in March 2024. Even so, her months on her employer's plan while working (December 2020 through July 2023) were left out of her penalty (POMS HI 00805.281).
To ask, you need proof of those months: a CMS-L564 from the employer, or other proof if the employer can't provide it.
How to avoid the penalty
- Use your 8-month Special Enrollment Period. It starts the month after your job or coverage ends, whichever comes first.
- Sign up about a month before your job coverage ends, as Medicare.gov suggests.
- Don't count COBRA or retiree coverage as a reason to wait.
- If an employer or plan gave you wrong information on or after January 1, 2023, ask Social Security about the exceptional-conditions Special Enrollment Period.
The late penalty is separate from the income-related amount that higher-income people pay. CMS says that affects roughly 8% of people with Part B.