AHIP Practice Exam

What may happen if Mrs. Quinn delays enrolling in a Medicare prescription drug plan?

1. Her coverage will be canceled

2. She will pay a penalty on her future premiums

3. She will receive coverage automatically later

4. There will be no financial consequences

The correct answer is: She will pay a penalty on her future premiums

Delaying enrollment in a Medicare prescription drug plan can result in a penalty on future premiums. This penalty is a consequence designed to encourage timely enrollment when eligible. The penalty typically applies if an individual goes without creditable prescription drug coverage for 63 days or more after their initial enrollment period for Medicare. This means that if Mrs. Quinn decides to wait and enroll in the plan later, she may face an increase in her premium costs based on the length of time she delayed enrollment. This financial penalty can persist for as long as she remains enrolled in a Medicare prescription drug plan, potentially leading to higher ongoing costs than she would have faced had she enrolled on time. Choices that indicate her coverage will be canceled, that she will receive coverage automatically, or that there will be no financial consequences do not accurately reflect Medicare’s policies regarding late enrollment in prescription drug plans. The system is structured to motivate individuals to enroll during their initial eligibility period to avoid additional costs.