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Hernando Today

Medicare Part D Penalties Apply

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By ADON TAFT, Life to the Fullest

Hernando Today

Published: December 23, 2008

QUESTION: I enjoy your weekly column in Hernando Today. I have a question regarding Medicare's prescription drug coverage.
I have participated for two years, starting as soon as I was eligible. I know there is a penalty if one doesn't take the coverage when they are first eligible but wonder if there is a penalty if a person drops out and then comes back (skips one or more years).
I am thinking of dropping out this year but don't want to pay a penalty if I discover that I have made a mistake.
M.W., Brooksville
ANSWER: All Medicare programs are insurance policies rather than entitlements. You can't wait until you need insurance to buy a policy.
As you correctly stated, there is a penalty if you don't take Medicare Part D coverage when you first become eligible. The penalty amounts to 1 percent of the average cost of the premiums for all Medicare prescription drug policies. The average cost of premiums for 2009 will be around $50 a month so the penalty would be $6.50 a month if you were one year late in enrolling.
That same penalty would apply if you were to drop out of the Part D coverage for a year or two and then return. That would be considered a late enrollment because you would have been eligible during that year or two.
Say, for example, that you drop out for a year because you don't expect to need more than an occasional prescription. A month or two later you are diagnosed with some chronic disease that requires regular, expensive drug treatment. You then want prescription drug insurance under Medicare.
If the monthly premium for the policy you then choose is $55, the $6.50 penalty for missing a year of coverage would be added to the cost. You would be required to pay $61.50 a month for the same coverage for which others would be paying $55 a month. That extra $6.50 a month would be applied every year you have Part D coverage, whether 5, 10, 15 years or more, no matter what policy to which you subscribe with whatever company.
Should you have difficulty paying Part D premiums because you are in a low income bracket, there are government and pharmaceutical company assistance programs for which you may qualify.
QUESTION: At age 54, I retired on disability. I receive the maximum Social Security benefit as if I had reached the full retirement age of 66.
My wife and I have a handicapped son who was on Supplemental Security Income prior to my disability. When I became disabled, the government cut his SSI but supplemented his benefit by the same amount from Social Security.
My wife was 51 when I retired and she began receiving the same amount of Social Security that our son receives because she is his caregiver.
When she turns 62 and should she retire, will the amount she receives go up or down or will it remain the same? Her Social Security retirement benefit will have to be based on my work record because she has not worked outside the home for enough quarters to qualify on her own.
J.F., Masaryktown
ANSWER: Most likely her benefit will rise slight since the spousal benefit usually is greater than a caretaker's benefit. However, when all family members are receiving benefits based on one person's work record, there is a limit on the total family benefit.
Your or your wife should ask the Social Security office in Port Richey. They will give her the greatest benefit for which she is qualified.

If you have questions about any issues connected with aging, except medical conditions, please write to Life to the Fullest, Hernando Today, 13299 Cortez Blvd., Brooksville, Fla., 34613, or send e-mail to adontaft@yahoo.com. Please include your name and address.

Adon Taft is a resident of Brooksville.

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