A penalty will be assessed to anyone who
1. Did not join a Medicare drug plan when they were first eligible for Part A and/or Part B
OR
2. Went without credible prescription drug coverage for 63 days or more
Penalty will be for ALL uncovered months
 
Proceed to ‘2‘

Calculate number of fully uncovered months:
Example: Uncovered from
May 16, 2006 – December 31, 2008 = 31 months
 
Proceed to ‘3‘

Penalty is 1% for each number of fully uncovered months:
Example: 31 months x 1% = 31%
 
Proceed to ‘4‘ .

Multiply penalty percent by current National base beneficiary premium*
Example: (2013): $31.17 x 31% = $9.66
 
Proceed to ‘5‘

Cost of Standard Part D plan premium + $9.66 (late enrollment penalty) =
Part D total monthly premium
 
Proceed to ‘6‘

The penalty will be added to the standard premium of any Part D plan for which the member enrolls. The member will have to pay the penalty each month as long as she/he has the Medicare prescription drug coverage