I have found that the most common issue new Medicare recipients have is related to Prescription Drug Plans on Medicare. Too often when turning 65, seniors who enroll in Medicare only Part A and Part B do not enroll in a PDP (Prescription Drug Plan). Especially if they are not taking any medications. You may be at risk for an LEP, Late Enrollment Penalty. Here are three ways to avoid this penalty. 

3 ways to avoid the late enrollment penalty

1. Join a Medicare drug plan when you're first eligible.

You won't have to pay a penalty, even if you've never had prescription drug coverage before.

2. Don't go 63 days or more in a row without a Medicare drug plan or other creditable drug coverage.

Creditable prescription drug coverage could include drug coverage from a current or former employer or union, TRICARE, Indian Health Service, the Department of Veterans Affairs, or health insurance coverage. Your plan must tell you each year if your drug coverage is creditable coverage. They may send you this information in a letter, or draw your attention to it in a newsletter or other piece of correspondence. Keep this information because you may need it if you join a Medicare drug plan later.

3. Keep records showing when you had creditable drug coverage, and tell your plan about it.

When you join a Medicare drug plan, the plan will check to see if you had creditable drug coverage for 63 days or more in a row. If the plan believes you didn't, it will send you a letter with a form asking about any drug coverage you had. Complete the form and return it to your drug plan by the deadline in the letter. If you don't tell the plan about your creditable drug coverage, you may have to pay a penalty.