You turn 65 and figure you'll sort out Medicare when you get around to it. Maybe you're still working, still covered by your employer's plan, and it feels like there's no rush. That's the thinking that leaves people with permanent premium penalties, coverage gaps, and supplement insurance they can't get at any price.
Medicare's rules are genuinely complicated, and the system is built in a way that punishes delays whether you meant to delay or not. The mistakes below are not obscure edge cases. They're the ones that come up over and over, often with consequences that last for the rest of a person's life.
Missing the initial enrollment window
Most people become eligible for Medicare at 65, and the enrollment window lasts seven months: the three months before your birthday month, your birthday month itself, and the three months after. That's it for your penalty-free entry point, unless you qualify for a special enrollment period. Missing it means waiting for the General Enrollment Period, which runs January through March each year, with coverage starting July 1. If your birthday is in May, you could go nearly a year without coverage before Medicare kicks in.
Missing the window doesn't just create a gap. It triggers late enrollment penalties that stack on top of your premiums permanently. Most people assume they'll be able to sign up any time they're ready. That's not how Medicare works, and the gap between what people expect and what actually happens can be expensive.
Assuming COBRA counts as creditable coverage
When you leave a job at 65 or older, COBRA lets you continue your former employer's health plan for up to 18 months. A lot of people treat this as a way to delay Medicare without penalty. It isn't. COBRA does not count as employer-sponsored coverage for Medicare purposes and does not give you a Special Enrollment Period for Part B. If you rely on COBRA and skip Medicare enrollment, the Part B penalty clock starts running the day your Initial Enrollment Period ends.
The same rule applies to retiree coverage offered by a former employer. Even though it may continue a plan you had while working, Medicare treats retiree coverage differently from active employer coverage. Neither COBRA nor retiree plans pause the penalty window. If you're 65, leaving a job, and thinking COBRA will buy you time, it won't.
The only coverage that lets you delay Part B without penalty is active employer-sponsored insurance tied to current employment, either yours or your spouse's, at a company with 20 or more employees. Once that coverage ends, you have an eight-month Special Enrollment Period to sign up for Part B before penalties apply.
Working for a small employer and thinking you're covered
Here's a rule many people don't know exists: if your employer has fewer than 20 employees, Medicare is your primary insurer the moment you turn 65, not your employer's plan. Your employer's plan becomes secondary. That means if you haven't enrolled in Medicare Parts A and B, your employer's plan may pay little to nothing on your medical claims, because it's expecting Medicare to go first.
Some small employer plans are designed to deny or reduce claims for employees who should have Medicare as their primary coverage but haven't enrolled. It's not a punitive policy on the plan's part. It's how the coordination rules work. You can end up holding significant medical bills with nowhere to turn.
If you're not sure how many employees your company has, ask HR directly and get the answer in writing. The 20-employee threshold is based on the number of employees in the current or prior calendar year, and the counting rules include part-time and seasonal workers. If your company is close to the line, confirm before you assume you can delay.
Delaying Part B and taking a permanent penalty
The Part B late enrollment penalty is 10% of the standard premium for every full 12-month period you were eligible but didn't enroll, and it lasts for as long as you have Medicare. The standard Part B premium in 2026 is $202.90 per month. Delay by seven years without qualifying coverage and your premium becomes $344.93 per month, every month, for life.
That penalty also adjusts upward whenever the base Part B premium increases, which it does almost every year. A 70% penalty on a $202.90 base looks different from a 70% penalty on whatever the base becomes in 10 years. The dollar gap between what you'd pay and what you actually pay keeps widening.
The exception to this penalty is valid only if you had active employer coverage from a company with 20 or more employees during those years. If you had any gap in that coverage, or if the employer size didn't qualify, the penalty applies to those months. People who assumed their coverage qualified and found out later it didn't have very limited options for relief.
Skipping Part D because you don't take any prescriptions
Part D covers prescription drugs, and a lot of people who don't currently take any medications decide to skip it. That logic doesn't hold up. The Part D late enrollment penalty is 1% of the national base beneficiary premium for every month you go without creditable drug coverage after you first become eligible. In 2026, the national base beneficiary premium is $38.99. Miss 24 months and you're paying roughly $9.40 more per month, permanently.
More immediately, you can't enroll in Part D at any time. Without a qualifying Special Enrollment Period, you have to wait for the Annual Enrollment Period each October through December, which could leave you without drug coverage for months if you suddenly need a prescription.
The creditable coverage exception works here too. If your employer's drug plan is considered creditable, meaning it covers at least as much as standard Part D, you can delay Part D without penalty. Your employer is required to send a notice each fall telling you whether your plan qualifies. If you tossed that letter without reading it, call HR and ask. Plans that were creditable in prior years may not meet the current standard, particularly high-deductible health plans.
Missing the Medigap open enrollment window
Original Medicare covers a lot, but it leaves significant gaps. Most people pair it with a Medigap supplemental policy to cover things like Part A and Part B deductibles and the 20% coinsurance on outpatient care. The catch: you have exactly six months to buy a Medigap policy with guaranteed acceptance, starting the month you're both 65 or older and enrolled in Part B. During that window, insurers must sell you any plan they offer in your state at the best available rate, regardless of your health history.
After that window closes, they can run your medical history, charge higher premiums based on conditions, or deny you entirely. People who were healthy at 65 and bought a Medicare Advantage plan instead, then developed health problems later and wanted to switch back to Original Medicare with a Medigap policy, sometimes find out they can't get one at any price.
A small number of states offer additional protections. Connecticut, Massachusetts, and New York let you buy Medigap policies year-round without underwriting. A growing list of states, including California and Oregon, have birthday-rule windows that allow annual switching between plans. Most states offer nothing after the initial six months. Check your state's rules before you assume you can buy a Medigap policy later.
Switching to Medicare Advantage and finding out you can't switch back
Medicare Advantage plans are often attractive at enrollment: lower premiums, extra benefits, and built-in drug coverage. But they come with provider networks, and what looks good at 65 may not work well at 75 when your health needs change. People who decide to switch back to Original Medicare often want to add a Medigap policy at the same time, and that's where the problem surfaces.
Once you're past your initial six-month Medigap open enrollment period, switching back to Original Medicare doesn't give you a new guaranteed right to buy a Medigap plan. You can switch to Original Medicare, but you could be denied Medigap coverage because of preexisting conditions, or charged substantially more based on your health history. Conditions like diabetes or heart disease can result in denial from multiple insurers.
One exception: if you try Medicare Advantage for the first time and decide to leave within the first 12 months, you have a trial right to buy a Medigap policy with guaranteed acceptance. If your plan leaves the market or stops serving your area, you also have guaranteed issue rights. Outside of those situations, the Medigap window you had at 65 is largely gone. This is one of those decisions that feels reversible and isn't.
Paying too much in IRMAA because you didn't appeal
Medicare doesn't charge everyone the same premium. Higher-income beneficiaries pay a surcharge called IRMAA, the Income-Related Monthly Adjustment Amount, on top of their standard Part B and Part D premiums. In 2026, that surcharge starts at an additional $1,148 per year and can reach $6,936 per year at the highest income tier, and that's just for Part B.
The wrinkle: Medicare bases your 2026 IRMAA on your 2024 tax return. If you retired in 2024 or 2025, sold a business, or had any other income event that's no longer recurring, Medicare is still using that old number to calculate your surcharge. That means new retirees with substantially lower current incomes often pay surcharges that don't reflect their actual financial situation.
The fix is to file Form SSA-44 with the Social Security Administration and document the life-changing event that caused your income to drop. Qualifying events include retirement, divorce, loss of a spouse, and reduction in work hours. Social Security can use your more recent income to recalculate your premium. If you don't file the appeal, the overpayment continues until your tax data catches up, which takes two years. Most people don't know the appeal exists.
Contributing to an HSA after Medicare enrollment kicks in
Health Savings Accounts are a solid retirement planning tool, but they come with a hard stop: once you're enrolled in any part of Medicare, you can no longer contribute to an HSA. Contributions made after your Medicare coverage starts are considered excess contributions and subject to a 6% excise tax for every year the money stays in the account uncorrected.
The part that catches people off guard is the six-month retroactive enrollment rule. When you enroll in Medicare Part A after age 65, coverage can be backdated up to six months. If you delayed Medicare and then enrolled, Medicare may technically have covered you starting months before your application date. Any HSA contributions during those backdated months become excess contributions after the fact. This catches people who thought their timing was clean because they hadn't enrolled yet.
Applying for Social Security retirement benefits after age 65 automatically triggers Part A enrollment, which activates that same six-month lookback. If you've been contributing to an HSA while delaying Medicare and then apply for Social Security, the retroactive Part A coverage can turn recent HSA contributions into taxable excess contributions before you realize what happened. Stop contributing six months before you plan to apply for Medicare or Social Security, whichever comes first.
Not reviewing your plan every year during open enrollment
Medicare plans are not set-and-forget. Medicare Advantage and Part D plans change their premiums, drug formularies, and provider networks every year. A drug your plan covered in 2025 may not be covered in 2026, or may have moved to a more expensive tier. A doctor who was in-network last year may not be this year. These changes go into effect January 1 regardless of whether you read your plan's Annual Notice of Change letter.
The Medicare Annual Enrollment Period runs October 15 through December 7 each year. That's your window to compare plans and switch without penalty if a different plan better fits your current situation. The Medicare Plan Finder at Medicare.gov lets you compare costs based on your actual prescriptions and providers. Most people who skip this step are paying for coverage that no longer matches their needs.
For 2026 specifically, plan changes have been significant. Insurers cut benefits and raised cost-sharing across many Medicare Advantage plans, and roughly 2.6 million people saw their MA plans terminated at the end of 2025, requiring them to actively choose new coverage. If you haven't reviewed your plan recently, this is the year to do it..
