When is a Late Enrollment Penalty (LEP) assessed by CMS?

The Late Enrollment Penalty (LEP) is assessed by the Centers for Medicare & Medicaid Services (CMS) when an individual is without creditable prescription drug coverage for a continuous period of 63 days or more. This period serves as a threshold, indicating that a beneficiary has gone too long without having the required insurance coverage.

If someone fails to enroll in Medicare Part D when first eligible and then goes for more than 63 days without any form of creditable drug coverage, they can incur a penalty when they eventually enroll. This penalty is a monthly increase in the premium for Medicare Part D that lasts as long as the individual is enrolled in the plan.

Understanding this cutoff is essential for beneficiaries to avoid additional costs related to their prescription drug coverage. The other options do not align with CMS guidelines regarding the LEP assessment timeframe.