Part D Late Enrollment Penalty
A permanent surcharge (1 percent of national base premium per month delayed) for going without credible drug coverage beyond the initial enrollment window.
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What is 'creditable coverage' in the context of Medicare Part D?
Prescription drug coverage that is at least as good as the standard Medicare Part D coverage, which helps avoid the late enrollment penalty — Creditable coverage, in the Part D context, is prescription drug coverage that is actuarially determined to be at least as good as the standard Medicare Part D coverage. A beneficiary who maintains creditable drug coverage through an employer plan or other source does not incur the Part D late enrollment penalty when they later enroll. The agent should advise clients to keep evidence of creditable coverage, since the determination is what shields them from the 1%-per-month lifetime penalty. Employer plans must provide an annual creditable coverage notice so the beneficiary has written proof; without it, the agent should caution the client that a late enrollment penalty may apply when Part D is eventually chosen.
National insurance concept
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