Q. If one decides to defer Medicare Part B at age 65 and continue with health care coverage under FEHBP, is there a penalty? I have read that it is 10 percent a year for each year after 65 — is this true? Is there a ceiling on the penalty amount?
A. As long as you or your spouse are currently employed, there won’t be any penalty. You can delay your enrollment in Part B until you are no longer covered under that FEHB plan based on current employment. Then you will have an eight-month, penalty-free period in which you can enroll.
On the other hand, if you are no longer employed, your Part B coverage will be 10 percent for every year you could have been enrolled but weren’t. There is no ceiling on that penalty.