Yes, there can be a penalty for not enrolling in Medicare Part A at age 65 if you have to pay a premium for it, which is a 10% increase on your monthly premium for twice the number of years you delayed enrollment, but most people get premium-free Part A and avoid this penalty, especially if they have other creditable coverage like employer insurance.
If you and/or your dependent are over age 65, retired, and eligible for premium-free Medicare Part A and premium-based Medicare Part B, CalPERS requires you to enroll in both Part A and Part B and then transfer into a CalPERS Medicare health benefits plan to continue CalPERS health coverage.
Employer coverage: If you were covered by an employer or your spouse's employer when you first became eligible, you may delay enrollment without penalty. Medicaid or state programs: If you qualify for Medicaid, you're protected from penalties.
Strictly speaking, Medicare is not mandatory. But very few people will have no Medicare coverage at all – ever.
Medicare penalties, such as late enrollment fees, can sometimes be waived due to exceptional circumstances. To apply, contact the Social Security Administration or Medicare directly to request a reconsideration or waiver. Provide documentation of hardship or medical issues affecting timely enrollment.
Yes, there are penalties for not signing up for Medicare at 65, primarily for Part B (Medical Insurance) and sometimes Part D (Prescription Drugs), with Part B penalties being a permanent 10% increase on your premium for each 12-month period you delay enrollment, unless you have creditable coverage from a current employer (or spouse's employer). Part A (Hospital Insurance) is often premium-free, but if you're ineligible and delay, you can face a 10% penalty for twice the number of years you delayed.
Here are some of the biggest Medicare mistakes to avoid:
There are some risks to dropping coverage: Your costs for health care: You may have to pay all of the costs for services that Medicare covers, like hospital stays, doctors' services, medical supplies, and preventive services.
Generally, this is when you're first eligible to sign up for Part A and Part B. It starts 3 months before you turn 65 and ends 3 months after the month you turn 65. , unless you have other coverage that's similar in value to Medicare (like from an employer).
Part A (Hospital Insurance) costs. $0 for most people (because they or a spouse paid Medicare taxes long enough while working — generally at least 10 years). If you get Medicare earlier than age 65, you won't pay a Part A premium. This is sometimes called “premium-free Part A.”
The $2,000 prescription cap for seniors is a real benefit from the Inflation Reduction Act (IRA) that began in 2025, setting a limit on out-of-pocket prescription drug costs for Medicare Part D enrollees, meaning beneficiaries pay no more than $2,000 annually for covered medications, with the cap increasing to $2,100 in 2026. This major change eliminates the "donut hole" and provides significant savings for seniors with high drug costs, allowing costs to be spread out monthly.
Starting in 2025, there is an annual limit on what you pay out-of-pocket for prescription medications through Medicare and Medicare Advantage prescription drug plans. All prescription medications, including specialty medications, covered by Part D plans are included under this cap.
12 Things You Must Do as Soon as You Turn 65
Medicare rules allow you to delay enrollment in Medicare Part B and/or D when you are covered by an employer group health plan, regardless of the number of covered employees, if your health coverage is based on your or your spouse's current, active employment.
Medicare Advantage Plan (Part C)
A type of Medicare-approved health plan from a private company that you can choose to cover most of your Part A and Part B benefits instead of Original Medicare. It usually also includes drug coverage (Part D).
Premium-Free Medicare Part A Based on Age
To be eligible for premium-free Part A on the basis of age: A person must be age 65 or older; and. Be eligible for monthly Social Security or Railroad Retirement Board (RRB) cash benefits.
The best people to talk to about Medicare are your local State Health Insurance Assistance Program (SHIP) (for free, unbiased advice) or your specific Medicare plan's customer service (for plan-specific questions). For enrollment, contact the Social Security Administration (SSA), while independent brokers can compare plans, and organizations like the NCOA or AARP offer resources and tools.
Vermont, Utah and Minnesota topped the Commonwealth Fund's Medicare performance scorecard in 2025, whereas Kentucky, Mississippi and Louisiana struggled the most.