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Medicare Penalties Await Released Prisoners Who Apply After Age 65

Add potential penalties for late Medicare registration to the list of hurdles that prisoners must clear if they are released after their 65th birthday. Medicare regulations impose a penalty of 10% per year for each year of delay after age 65, when eligible individuals can begin receiving Medicare benefits. Incarceration is not considered a valid excuse for avoiding the penalty, even though prisoners cannot receive benefits.

Generally, eligible persons are supposed to sign up for Medicare Part B during their initial enrollment period, which begins three months before they reach age 65 and ends three months after they turn 65. If they are already receiving Social Security when they turn 65, they will be enrolled in Medicare automatically.

Medicare Part A, which provides for payment of some hospital-related expenses after an enrolled individual reaches age 65, even if they are not yet eligible for Social Security, is free. Most people or their spouses paid the Medicare Part A fees as part of their withholding tax while they were employed. Medicare Part B, which covers some doctor bills and other medical expenses not covered by Part A, may be obtained when someone reaches age 65, but has a modest premium of approximately $109 to $134 per month on average.

Unfortunately, even though Part A is free, a late filing will still trigger a 10% penalty for each year after age 65 that a person waits to enroll. The same penalty applies for tardy Part B applications. The penalty could add up to thousands of dollars of lost Social Security payments, since Medicare premiums are automatically deducted from Social Security benefits.

On the other hand, Social Security payments may be deferred without penalty. In fact, many people postpone applying for Social Security at their eligible age for the purpose of increasing their payments when they finally apply for benefits. That is not the case with Medicare, however.

How, then, do elderly prisoners deal with this issue, assuming they previously worked at a job and paid into Social Security and Medicare? The application to enroll in Medicare Part B does not have to be done in person; it can be accomplished online or by printing and mailing in an application form, though prisoners should first seek advice from their local Social Security office.

According to the American Association of Retired Persons (AARP), “If you are in prison when you turn 65, it’s another Catch-22 situation. You are expected to enroll in Part B and pay premiums while incarcerated, even if you have no income, or face late penalties and possibly delayed coverage on your release.”

With elderly prisoners comprising an increasing portion of the nation’s prison population, the late Medicare enrollment penalty will likely affect a growing number of prisoners over age 65 once they are released – just another collateral consequence of incarceration. 


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