Georgia Medicare Part B Late Enrollment Penalty (LEP) Guide

A Georgia senior who delays Medicare Part B for three years past 65, with no qualifying exception, owes the Part B Late Enrollment Penalty (LEP): a 30% surcharge for as long as she has Part B. At the 2026 standard Part B premium of $202.90 per month, that surcharge adds $60.87 a month, or $730.44 a year, and it climbs every year the premium does. A five-year delay means a 50% penalty ($101.45 a month); a ten-year delay doubles the premium outright. The good news for Georgia families: almost every one of these penalties is avoidable, and several can be erased after the fact. The tools are the Initial Enrollment Period (IEP), the Special Enrollment Periods (SEPs), the Section 1839(b)(3) Medicare Savings Program (MSP) Buy-In exemption, and the Equitable Relief procedure for federal-agency errors.1

This guide gives Georgia families the complete picture of the Part B LEP: the federal statutory and regulatory framework under Section 1839(b) of the Social Security Act and 42 CFR 407.20, the mathematical mechanics of the penalty calculation, the Special Enrollment Periods that avoid it (the Working Aged Group Health Plan SEP, the COBRA limits that trap so many retirees, and the exceptional-conditions SEPs at 42 CFR 407.23 for Medicaid loss, employer misinformation, release from incarceration, declared disasters, and case-by-case hardship, plus what FEHB and TRICARE coverage does and does not do), the Section 1839(b)(3) Buy-In exemption that wipes the LEP off the bill for Georgia Medicare Savings Program enrollees going forward, the Equitable Relief procedure under Section 1837(h) for Social Security Administration (SSA) mistakes, the Beneficiary Enrollment Notification and Eligibility Simplification (BENES) Act 2020 reforms that took effect in 2023, comparison to the Part A and Part D LEPs, and four worked examples that illustrate typical Georgia LEP scenarios.

At a glance. The Part B LEP adds 10% of the standard premium for every full 12 months you could have had Part B but did not, and it is permanent unless removed. In Georgia the surest fixes are on-time enrollment at 65, the Working Aged Group Health Plan Special Enrollment Period, the Section 1839(b)(3) Medicare Savings Program Buy-In, and Section 1837(h) Equitable Relief. The dollar ladder and the eligibility limits are in the tables below.1

The Federal Framework: Section 1839(b) and Its Amendments

The Medicare Part B Late Enrollment Penalty was created in the original Social Security Amendments of 1965 (Public Law 89-97), the same legislation that created Medicare itself. Congress understood from the start that voluntary insurance programs face an adverse selection problem: if healthy seniors can delay enrollment until they need care, the risk pool tilts toward the sick and premiums spiral upward. The Part B LEP was designed to incentivize on-time enrollment by making delayed enrollment permanently more expensive. The statutory authority is Section 1839(b) of the Social Security Act, codified at 42 USC 1395r(b), with implementing regulations at 42 CFR 407.20, operational instructions in CMS Internet-Only Manual (IOM) Publication 100-04 Chapter 18, and SSA operational guidance in Program Operations Manual System (POMS) HI 00805.000 series.

The original Section 1839(b) language is nearly unchanged from 1965: the standard Part B premium is "increased by 10 percent of the monthly premium for each full 12 months" of delay beyond the Initial Enrollment Period. The Omnibus Budget Reconciliation Act of 1989 refined the LEP calculation and clarified the interaction with Special Enrollment Periods that had been created in earlier amendments. The Balanced Budget Act of 1997 (Public Law 105-33) made additional SEP refinements. The Medicare Modernization Act of 2003 (Public Law 108-173) expanded several SEPs to address gaps in the original framework. The Medicare Improvements for Patients and Providers Act of 2008 (MIPPA, Public Law 110-275) expanded the Part D Low Income Subsidy (LIS) enrollment protections. The 21st Century Cures Act of 2016 made modifications to the COBRA SEP rules. Most recently, the Beneficiary Enrollment Notification and Eligibility Simplification (BENES) Act of 2020, enacted as section 120 of Division CC, Title I of the Consolidated Appropriations Act, 2021 (Public Law 116-260), took effect for enrollments occurring on or after January 1, 2023. It eliminated the up-to-six-month coverage delay that previously plagued the General Enrollment Period, simplified the GEP coverage start date to the month after enrollment, and established Section 1837(m) of the Social Security Act, which gives the Secretary of Health and Human Services authority to create Special Enrollment Periods for people who meet exceptional conditions.2

The Section 1839(b)(3) exemption is the most important Georgia-specific provision in the entire LEP framework. Originally added as part of the Medicare Catastrophic Coverage Act of 1988 and refined in subsequent legislation, Section 1839(b)(3) provides that a beneficiary enrolled in the State Buy-In through a Medicare Savings Program (QMB, SLMB, or QI) is exempt from the LEP for months during which the Buy-In is active. This means that a low-income Georgia senior who racked up a substantial LEP through years of missed Part B enrollment can have that LEP effectively zeroed out by qualifying for a Medicare Savings Program through the Division of Family and Children Services (DFCS) and Georgia Department of Community Health (DCH). The LEP technically remains on the CMS record, but the beneficiary owes nothing while the State Buy-In is active, since Georgia pays the standard premium and the federal exemption removes the surcharge. This is the single most powerful tool in the LEP-relief toolkit for low-income Georgia families.

The Equitable Relief framework provides relief when the delayed enrollment was caused by error, misrepresentation, or inaction by a federal employee, or by anyone authorized to act for the federal government: typically SSA, CMS, the Office of Personnel Management (OPM) administering FEHB, or the Department of Defense administering TRICARE. Under 42 CFR 407.32, SSA or CMS may take whatever action is necessary to provide appropriate relief, including designating enrollment and coverage periods and adjusting premium liability. SSA's operating rules are in POMS HI 00805.170, which cites Section 1837(h) of the Social Security Act and 42 CFR 406.26 and 407.32, and which requires three elements in every granted case: government error, misrepresentation, or inaction; prejudice to the person's Part B rights; and evidence of the error. Relief is denied if the person caused or materially contributed to the error through fraud or similar fault. There is no time limit on granting relief, and no request is required in a case where the government clearly erred, though in practice most cases start with one. Equitable Relief never applies to premium-free Part A.3

How the Georgia Medicare Part B LEP Is Calculated: 10% Per 12 Months

The Part B LEP calculation is mechanically simple but conceptually subtle. The formula: count the number of full 12-month periods between the end of the Initial Enrollment Period (or, in some cases, the end of a qualifying SEP) and the effective date of the actual Part B enrollment. Multiply that count by 10%. Apply that percentage to the standard Part B premium in effect each year (not the premium in effect at the time of delay). Add the resulting surcharge to the standard premium for each month for as long as the beneficiary has Part B, which for most people means a lifetime penalty unless one of the relief pathways below removes it.1

Partial 12-month periods do not count, only full 12-month periods. A beneficiary who enrolls 11 months late has no LEP. A beneficiary who enrolls 13 months late has a 10% LEP (one full 12-month period plus a partial period that does not count). A beneficiary who enrolls 25 months late has a 20% LEP (two full 12-month periods). A beneficiary who enrolls 60 months late has a 50% LEP (five full 12-month periods). A beneficiary who enrolls 120 months late has a 100% LEP, effectively doubling the standard premium for life.1

The LEP recalculates each year as the standard Part B premium changes. The 2026 standard premium is $202.90 per month, up from $185 per month in 2025. A beneficiary with a 30% LEP in 2025 paid $185 + $55.50 = $240.50 per month. The same beneficiary in 2026 pays $202.90 + $60.87 = $263.77 per month. As the standard premium continues to rise with Medicare cost growth, the dollar value of the LEP rises in proportion. Many beneficiaries do not realize this: they assume the LEP is fixed at the dollar amount established when they first enrolled. It is not. The LEP is a percentage, and the percentage applies to whatever the current standard premium happens to be. At the 2026 standard premium of $202.90 per month, the penalty ladder looks like this.1

One reason your bill may not match these figures to the penny: Medicare rounds the premium-plus-penalty total to the nearest $0.10. A 20% penalty of $40.58 on the $202.90 standard premium works out to $243.48, and Medicare bills it as $243.50. The dollar figures in this guide are the exact arithmetic; expect your actual notice to be rounded up or down by a few cents.1

A few key wrinkles affect the calculation. First, the LEP is computed based on the standard premium even for beneficiaries who pay income-related premium adjustments (IRMAA) on top of the standard. A high-income beneficiary subject to IRMAA pays IRMAA plus the standard plus the LEP, with each component computed separately. Second, the LEP percentage is computed from the date the IEP ended, not from age 65 or the SSDI 25th-month date. The IEP runs seven months: three months before the 65th birthday month, the birth month itself, and three months after. A senior who turns 65 in June 2023 has an IEP running March through September 2023; if she enrolls in November 2025, the delay is from October 2023 through October 2025, which is 25 months, which produces a 20% LEP. Third, the LEP attaches to the beneficiary, not to the policy: switching plans (Original Medicare to Medicare Advantage, or vice versa) does not affect the LEP. Fourth, the LEP is owed even if the beneficiary qualifies for premium-free Part A through their work history; the LEP applies only to Part B and is on top of whatever Part A premium the beneficiary owes (zero for most).1

Initial Enrollment Period (IEP): The Seven-Month Window

The Initial Enrollment Period under Section 1837(a) of the Social Security Act is the seven-month window during which a senior or person newly entitled to Social Security Disability Insurance (SSDI) can enroll in Medicare without penalty. For age-eligible beneficiaries (turning 65), the IEP runs from three months before the 65th birthday month through three months after the 65th birthday month. For example, a senior who turns 65 on August 15, 2026 has an IEP running May 1, 2026 through November 30, 2026. The IEP for SSDI-entitled beneficiaries runs around the 25th month of SSDI entitlement: three months before the 25th month, the 25th month itself, and three months after. SSDI beneficiaries are automatically enrolled in Part A and Part B at month 25, with the option to decline Part B if they have other coverage.

For age-eligible beneficiaries who are already collecting Social Security retirement or RRB benefits when they turn 65, enrollment in Part A and Part B is automatic. The beneficiary receives a Medicare card in the mail approximately three months before the 65th birthday with both Part A and Part B coverage starting on the first day of the birth month (or the prior month if the birthday falls on the first of the month). The beneficiary has the option to decline Part B by returning the card with the appropriate indication if they have other creditable coverage (typically a Group Health Plan from an active employer with 20+ employees). Most Georgians turning 65 who are already collecting Social Security do not need to take any action: the system enrolls them automatically.

For age-eligible beneficiaries who are not yet collecting Social Security (delayed retirement to age 67, 70, or later to maximize benefits), there is no automatic enrollment. The senior must actively enroll during the IEP through SSA, either online at ssa.gov/medicare/sign-up, by phone at 1-800-772-1213 (TTY 1-800-325-0778), or in person at a local SSA office.4 This is the most common LEP trap in Georgia: a senior who delays Social Security to age 70 to maximize benefits assumes that Medicare also waits until age 70. It does not. Medicare and Social Security have separate enrollment frameworks, and a senior who delays Social Security must still enroll in Medicare during the IEP at age 65 or qualify for an SEP.

Coverage start dates within the IEP changed under the BENES Act 2020 for enrollments on or after January 1, 2023. If the beneficiary enrolls during the three months before the birth month, coverage still starts on the first day of the birth month. If the beneficiary enrolls in the birth month itself or during the three months after, Part B coverage now starts the first day of the month after enrollment. Premium-free Part A is not delayed that way; it starts the month the beneficiary turns 65. This eliminated the old rule under which late-IEP enrollment could delay coverage by two or three months, a change that matters for those timing the transition off employer coverage at age 65.2

General Enrollment Period (GEP): January 1 Through March 31

Beneficiaries who miss the Initial Enrollment Period and do not qualify for a Special Enrollment Period must enroll in Part B during the General Enrollment Period, which runs every year from January 1 through March 31 under Section 1837(c) of the Social Security Act. Under the original GEP rules, coverage did not begin until July 1 of the same year, meaning a beneficiary enrolling on January 2 had to wait six months for coverage. The BENES Act 2020 changed this for enrollments on or after January 1, 2023: under the new rule, GEP coverage begins the first day of the month after enrollment. A beneficiary enrolling in January 2026 has coverage starting February 1, 2026. A beneficiary enrolling in March 2026 has coverage starting April 1, 2026.

The GEP is the safety valve for missed-IEP beneficiaries, but it does not waive the LEP. Every full 12-month period of delay from the end of the IEP through the start of GEP coverage adds 10% to the LEP. A senior who turned 65 in 2023, missed the IEP, and enrolls during the January 2026 GEP for February 2026 coverage has a delay of approximately 28 months, which produces a 20% LEP (two full 12-month periods).1

The GEP is the wrong place for most Georgia seniors. If a senior has been working past age 65 with employer coverage from a large employer (20+ employees), the Working Aged GHP SEP described below is the correct enrollment vehicle, with no LEP. If the senior has lost employer coverage and is within 8 months of that loss, the GHP SEP applies, with no LEP. Only if the senior has no qualifying SEP and missed the IEP does the GEP become the right answer, and even then the Section 1839(b)(3) Buy-In exemption may eliminate the LEP for low-income beneficiaries.

The Working Aged Group Health Plan (GHP) Special Enrollment Period

The most important LEP-avoidance pathway is the Special Enrollment Period for beneficiaries who delayed Part B because they had coverage from a Group Health Plan based on current employment. The authority is Section 1838(g) of the Social Security Act and 42 CFR 407.20 through 407.26. The rule: a beneficiary who has coverage from a GHP based on current employment (the beneficiary's own or their spouse's) at age 65 can delay Part B without penalty while the active employment continues. When the employment ends or the GHP coverage based on active employment ends (whichever comes first), the beneficiary has an 8-month Special Enrollment Period during which to enroll in Part B without LEP.5 One limit on that SEP catches Georgians who retire close to their 65th birthday: it does not apply if the employment, or the group health plan coverage based on it, ends during the Initial Enrollment Period. If the job ends inside those seven months, the IEP is the deadline and no 8-month window opens afterward.2

The critical phrase in the statute is "current employment" or "active employment." Retiree coverage is not active employment coverage and does not qualify a beneficiary for the GHP SEP. A senior whose employer continues to offer retiree health benefits past age 65 still must enroll in Part B during the IEP at age 65, or face an LEP. This is among the most common LEP traps: the retiree assumes that any employer coverage delays Part B enrollment, but only active employment coverage does so.

The 20-employee rule matters here. Under the Medicare Secondary Payer rules (42 CFR Part 411, 42 USC 1395y), an employer with 20 or more employees must allow active employees age 65 and older to keep their GHP as primary, with Medicare as secondary. If the employer has fewer than 20 employees, Medicare generally pays primary and the GHP becomes secondary, so you typically should enroll at 65 to avoid gaps in coverage. That is the practical rule for Georgians at small employers: with 20 or more employees you may delay Part B without penalty while you stay covered by that current-employment plan, and the 8-month SEP protects you when it ends; under 20 employees, delaying leaves your primary coverage sitting unused and puts a penalty at risk, so enroll during the IEP. If you are already past that point at a small employer, ask SSA what enrollment period it will apply to your case rather than assuming the answer.5

The 8-month SEP window begins the first day of the month after active employment ends or after the GHP coverage based on active employment ends, whichever is earlier. A senior whose active employment ended on June 15, 2025 has an 8-month SEP from July 1, 2025 through February 28, 2026. Enrolling within that window prevents the LEP. Enrolling outside the window (in March 2026 or later) means the beneficiary must wait for the next GEP and pay the LEP.

The COBRA Trap: COBRA Does Not Extend the GHP SEP

COBRA coverage is the single most common cause of unintended LEPs in Georgia and nationally. The rule under 42 CFR 407.20 and confirmed in numerous CMS guidance documents is clear: COBRA coverage is not coverage based on current employment. It is continuation coverage available to former employees who have lost their active employment GHP. As a result, the 8-month Special Enrollment Period clock starts when the job or the employer group coverage ends, not when COBRA ends, and waiting out the COBRA period first can trigger both a coverage gap and a lifetime Part B late enrollment penalty.6 A retiree who takes COBRA for the full 18 months after leaving employment has burned through the 8-month SEP about ten months before COBRA ends. By the time COBRA expires, the retiree faces a wait for the next GEP and an LEP.

The best fix is awareness: retirees with employer coverage approaching age 65 should plan for Part B enrollment to coincide with the end of active employment, regardless of whether COBRA is available. But a Georgian already caught by the trap is not always out of options. Equitable Relief is the narrower of the two: the bar there is whether the misinformation came from a federal employee or someone authorized to act for the federal government, so bad advice from a private benefits administrator generally does not qualify.3

The wider door, open since January 1, 2023, is the exceptional-conditions SEP at 42 CFR 407.23(c): misrepresentation or incorrect information from an employer or group health plan is its own named category, with a 6-month SEP that begins the day you notify SSA and carries no late enrollment penalty. A retiree whose benefits administrator told him COBRA would hold his Part B window open should raise that regulation with SSA by name rather than assume the GEP and a lifetime surcharge are the only path.7 A certified Georgia SHIP (GeorgiaCares) counselor can help you make that request, free of charge, at 1-866-552-4464, option 4.8

Exceptional-Conditions SEPs and Other Specialized Medicare Enrollment Paths

Beyond the Working Aged GHP SEP, a second family of Special Enrollment Periods covers people who missed enrollment because of an "exceptional condition." These were created by the Consolidated Appropriations Act, 2021 at Section 1837(m) of the Social Security Act, codified at 42 CFR 407.23, and effective January 1, 2023. Each one lets an eligible person enroll in Part B (and premium Part A) outside the usual windows with no late enrollment penalty, and coverage begins the first day of the month after the month of enrollment.7

The disaster SEP is the one Georgians reach for most often: a hurricane, flood, or other government-declared emergency that kept a beneficiary from enrolling on time opens a window that runs until six months after the declaration ends. The employer-misinformation SEP is the second: if an employer or its group health plan gave you a misrepresentation or incorrect information that led you to delay Part B, that is a named category, and the six-month clock starts the day you notify SSA rather than the day you were misinformed.7

Two situations that families often assume are covered are not on this list. Living outside the United States is one: people abroad who qualify for automatic enrollment receive Part A automatically but must actively sign up for Part B, and returning to the country does not by itself open a named SEP. A returning expatriate who missed the IEP should ask SSA whether the case-by-case "other exceptional conditions" SEP under 42 CFR 407.23(f) applies before assuming the GEP and an LEP are the only options.7,9

Federal and military coverage is the other. Federal Employee Health Benefits (FEHB) enrollment continues for federal retirees and is treated like other retiree coverage for LEP purposes: it is not coverage based on current employment, so it does not support the GHP SEP. TRICARE for Life goes further in the other direction. You must have both Medicare Part A and Part B to get TFL benefits, and it covers uniformed services retirees 65 or older, their eligible family members and survivors, and certain former spouses. For a military retiree in Georgia, skipping Part B costs both the LEP and the TFL wrap.10

Section 1839(b)(3) Buy-In Exemption: The Critical Georgia Pathway

The Section 1839(b)(3) Buy-In LEP exemption is the single most powerful tool for low-income Georgia beneficiaries facing an LEP. The statutory language at Section 1839(b)(3) of the Social Security Act provides that the LEP "shall not be increased" for months during which the State Buy-In is in effect. In plain English: while a Georgia beneficiary is enrolled in QMB, SLMB, or QI and the State Buy-In is paying the standard Part B premium, the LEP surcharge is not collected. The LEP technically remains on the CMS record, but the beneficiary owes nothing for the LEP during Buy-In months.

This is a critical pathway because it does not require the beneficiary to prove SSA error or qualify for Equitable Relief. The beneficiary need only qualify for one of the three Medicare Savings Programs that include Part B (QMB, SLMB, or QI) through DFCS, get the Buy-In activated, and the LEP is effectively eliminated for the duration of MSP enrollment. The 2026 Georgia MSP thresholds (which include the standard $20 general income disregard) are shown in the table below. The asset (resource) limit for 2026 is $9,950 for a single applicant and $14,910 for a couple, and it applies to QMB, SLMB, and QI alike. (QDWI also has a Buy-In, but it covers Part A only and does not affect the Part B LEP.)11

The interaction between the LEP and MSP enrollment is sometimes counterintuitive. A Georgia senior with a $60.87 monthly LEP from a 3-year delay can apply for QMB through DFCS. If approved, the State Buy-In activates, Georgia pays the $202.90 standard Part B premium directly to CMS through the Coordination of Benefits Agreement (COBA) accretion process, and the LEP surcharge is exempted under Section 1839(b)(3). The beneficiary's monthly Part B cost drops from $263.77 (premium + LEP) to $0 (full Buy-In coverage with LEP exemption). If the beneficiary later loses MSP eligibility (income rises, assets exceed limits, life change), the State Buy-In ends and the beneficiary returns to paying the full premium plus the LEP. The LEP did not disappear during the Buy-In period; it was suppressed. It returns when the Buy-In ends.1

A worked example illustrates the pathway: Mary, age 68, Atlanta. She missed her IEP in 2023 because she did not understand the rules. She enrolls in March 2026 GEP, with coverage starting April 2026. Her delay from the end of her IEP through that coverage start is 28 months, producing a 20% LEP (two full 12-month periods). Her 2026 monthly cost without MSP would be $202.90 + $40.58 = $243.48. Mary applies for QMB through DFCS in March 2026. Her income is $1,200 per month (Social Security retirement) and her assets are $6,000. She qualifies for QMB, and DFCS approves her application in April 2026. Here is the part families get wrong: QMB is prospective-only by statute. Under Section 1902(e)(8) of the Social Security Act, a QMB determination applies to services furnished after the end of the month in which the determination is first made, so Mary's QMB starts May 1, 2026 and cannot be backdated. She owes the full $243.48 for March and April and will not be reimbursed for them. (SLMB and QI are different: they follow the general Medicaid rule at 42 CFR 435.915 and can be effective up to 3 months before the application month.) Starting May 2026, Mary owes $0 for Part B; Georgia pays the standard premium, and the Section 1839(b)(3) exemption removes the LEP surcharge.12 Mary's effective LEP is zero for as long as she remains QMB-enrolled.1,11

Equitable Relief Under Section 1837(h)

Equitable Relief is the procedure by which SSA or CMS can waive the LEP and grant retroactive Part B enrollment when the beneficiary's enrollment or nonenrollment was unintentional, inadvertent, or erroneous because of the misrepresentation, error, or inaction of a federal employee, or of anyone authorized to act for the federal government. The authority is 42 CFR 407.32, and SSA's operating rules are in POMS HI 00805.170, which cites Section 1837(h) of the Social Security Act and 42 CFR 406.26 and 407.32.3 Common scenarios where Equitable Relief is approved: an SSA worker told the beneficiary at age 64 that he could "wait to enroll in Medicare until he stopped working" without explaining the small-employer rule; an SSA worker mailed an incorrect enrollment denial; CMS failed to process a timely enrollment request; the beneficiary received written confirmation of enrollment that did not actually take effect.

In practice the process starts with a written request from the beneficiary or their representative to the local SSA office, or by phone at 1-800-772-1213. No request is technically required in a case where the government clearly erred, and there is no time limit on granting relief, so a delay from years ago is still worth raising. The request should describe the specific error or misinformation, include supporting documents (SSA notices, contemporaneous notes, witness statements), and request specific relief (retroactive enrollment, LEP waiver, or both). Approved relief can include retroactive enrollment to the date the beneficiary should have been enrolled, prospective enrollment without LEP, an adjustment of premium liability, and refund of LEP amounts already paid. Equitable Relief never applies to premium-free Part A.3

Every granted case has to show three things: government error, misrepresentation, or inaction; prejudice to the beneficiary's Part B rights; and evidence of the error. Relief is denied where the beneficiary caused or materially contributed to the error through fraud or similar fault. That evidence element is why documentation decides most cases: beneficiaries who can produce a contemporaneous SSA notice, a written response to a request, or other proof of the error generally fare better than beneficiaries relying solely on recollection.3 The GeorgiaCares State Health Insurance Assistance Program (SHIP) at 1-866-552-4464 can help Georgia beneficiaries prepare Equitable Relief requests and is a free service. Atlanta Legal Aid Senior Citizens Law Project at 404-377-0701 and Georgia Legal Services Program at 1-800-498-9469 can provide legal representation for complex cases.13

Equitable Relief is not available for delays caused solely by private parties (employer benefits administrators, insurance brokers, financial advisors) unless those parties were acting as authorized agents of a federal agency, which is rare. Beneficiaries who relied on private advice have limited federal recourse, though they may have state-law claims against the advisor. The Section 1839(b)(3) Buy-In exemption pathway often provides more reliable relief than Equitable Relief for low-income Georgia beneficiaries, and the two pathways are not mutually exclusive.

Comparison: Part B LEP vs. Part A LEP vs. Part D LEP

The three Medicare penalties differ in who they hit, how they are calculated, and how long you pay them.1,14

The Part B LEP is one of three Medicare LEPs, and each operates on different rules. The Part A LEP applies only to the small percentage of beneficiaries who must pay a Part A premium (those without enough Social Security work credits to receive premium-free Part A). It is 10% of the standard Part A premium for 12-month periods of delay, but unlike Part B, the Part A LEP is paid for only twice the period of delay (capped). A 2-year Part A delay produces a 10% LEP for 4 years, not for life. Most Georgia beneficiaries do not face a Part A LEP because they qualify for premium-free Part A through their work history or their spouse's.15

The Part D LEP, established by the Medicare Modernization Act of 2003 (Public Law 108-173), applies to Part D prescription drug coverage. It is owed only if, at any time after the Initial Enrollment Period is over, there is a period of 63 or more days in a row without Medicare drug coverage or other creditable prescription drug coverage; a shorter gap triggers no penalty at all. Once that trigger is met the calculation differs from Part B: 1% of the national base beneficiary premium (a benchmark that changes each year, $38.99 in 2026) for each full uncovered month, rounded to the nearest 10 cents. A 24-month Part D gap produces a 24% Part D LEP, which translates to approximately $9.40 per month added to whatever Part D plan premium the beneficiary chooses. The Part D LEP normally lasts as long as you have Part D coverage, but it is not charged at all to people receiving the Low-Income Subsidy: under 42 CFR 423.780(e), subsidy-eligible individuals are not subject to a Part D late enrollment penalty, and Medicare says you will not pay one while you get Extra Help. Since the Inflation Reduction Act eliminated the partial-subsidy tier in January 2024, everyone who qualifies for Extra Help gets the full subsidy, so that waiver reaches every Extra Help recipient. Our Georgia Medicare creditable coverage guide explains what counts as creditable drug coverage and how to dispute a Part D LEP you should not owe.14,16

The three LEPs are independent: a beneficiary can face Part A LEP, Part B LEP, and Part D LEP simultaneously if all three delays occurred. The Section 1839(b)(3) Buy-In exemption applies to the Part B LEP and is implemented through MSP enrollment. The Part D LEP waiver is separate: it comes from the Extra Help (Low Income Subsidy) subsidy itself, which under 42 CFR 423.780(e) removes the Part D penalty. It does not merely pause it: CMS guidance for 2026, applying 42 CFR 423.286(e), 423.773(c) and 423.780(e), directs that becoming Extra Help eligible removes the penalty and resets the count of uncovered months to zero, and that if Extra Help later ends, a new gap is counted only from the day after it ended, so uncovered months from before Extra Help are not brought back. Georgia beneficiaries who qualify for QMB also qualify for Extra Help.16 A beneficiary with QMB and LIS thus has both the Part B LEP and Part D LEP lifted, which is a substantial protection for low-income Georgians.

Medicare Advantage Effects on the LEP

Enrollment in a Medicare Advantage (Part C) plan does not affect the LEP. The Part B premium and any LEP surcharge are paid to CMS regardless of whether the beneficiary's Part B benefits are administered through Original Medicare or through a Medicare Advantage plan. Many Medicare Advantage plans offer a Part B premium giveback (also called Part B premium reduction), which provides a credit back to the beneficiary's Part B premium, but this giveback applies only to the standard premium and not to the LEP. A beneficiary with a $60.87 monthly LEP enrolled in a Medicare Advantage plan with a $25 Part B giveback still pays the full $60.87 LEP each month.1

Switching from Original Medicare to Medicare Advantage or vice versa does not affect the LEP. The LEP is attached to the beneficiary's Part B enrollment, not to the choice of how Part B is delivered. A beneficiary who has been paying an LEP for 5 years and switches to Medicare Advantage continues to pay the LEP. A beneficiary who has been on Medicare Advantage and switches back to Original Medicare continues to pay the same LEP.

The interaction between Medicare Advantage and the Section 1839(b)(3) Buy-In exemption is straightforward: a beneficiary enrolled in QMB and a Medicare Advantage plan has the standard Part B premium paid by Georgia through the State Buy-In and the LEP surcharge exempted under Section 1839(b)(3). The Medicare Advantage plan delivers the Part B benefits but does not affect the underlying premium structure.

Worked Examples for Typical Georgia LEP Scenarios

The four scenarios below are illustrative composites, not real individuals. Each shows a different penalty pathway a Georgia family might face, with dollar figures at the 2026 standard premium.

Mary 68 Atlanta: missed IEP, qualifies for QMB, Buy-In exemption

Mary turned 65 on August 15, 2023 in Atlanta, Fulton County. She was collecting widow's benefits from Social Security at age 60 and assumed Medicare enrollment was automatic. The automatic enrollment is correct for beneficiaries collecting retirement or SSDI benefits at age 65, and Mary should have been auto-enrolled in Part A and Part B effective August 1, 2023. However, Mary had elected to receive Social Security benefits as paper checks rather than direct deposit, and her address change two months before her 65th birthday caused her Medicare welcome packet to go to her old address. The packet was returned to SSA, Mary never received the Medicare card, and the system processed it as if Mary had declined Part B. Mary did not realize she lacked Part B coverage until February 2026 when she went to the emergency room for a fall and the hospital billing department told her that her insurance card showed only Part A.

Mary's delay runs from the end of her IEP on November 30, 2023 (three months after her August 2023 birth month) through the April 1, 2026 start of her Part B coverage: 28 months, which is two full 12-month periods plus a partial period that does not count. Mary's LEP is 20% of the 2026 standard premium: $40.58 per month. Mary applies for Part B enrollment in March 2026 through the GEP. Her coverage starts April 1, 2026 under the BENES Act post-2023 rules. Her monthly Part B cost is $202.90 + $40.58 = $243.48.1

Mary's income is $1,200 per month from Social Security widow's benefits, and her assets are $6,000 in checking and savings combined. She qualifies for QMB through DFCS. Her son helps her file the application through Georgia Gateway in March 2026. DFCS approves the application in April 2026, and because QMB applies only to services furnished after the end of the month the determination is made, her QMB and the State Buy-In begin May 1, 2026. For March and April she pays the full $243.48, and those two months are not recoverable: QMB cannot be backdated. Starting May 2026, Mary pays $0 for Part B: Georgia pays the standard premium, and Section 1839(b)(3) exempts her from the LEP.12 Mary should also explore Equitable Relief for the SSA address-change error, which could grant retroactive Part B enrollment to August 2023 without LEP, providing additional protection if she ever loses QMB eligibility. GeorgiaCares can help her prepare the Equitable Relief request.11

George 70 Savannah: COBRA SEP trap

George retired from his Savannah engineering firm in June 2021, three months before his 65th birthday that September. The firm had 150 employees, and George had been covered under the firm's GHP. At retirement, George elected COBRA coverage to continue his GHP for 18 months (through December 2022). He believed that the COBRA coverage would qualify him for the Special Enrollment Period for Part B when the COBRA ended, and that he could safely delay Part B enrollment without LEP through the COBRA period.

This was incorrect on two counts. First, COBRA is not coverage based on current employment under Section 1838(g), so taking it never held his Part B window open.6 Second, George never had the 8-month SEP to begin with: his active employment ended in June 2021, inside his Initial Enrollment Period (which ran June through December 2021, seven months centered on his September birth month), and the working-aged SEP does not apply when the employment or the group health plan coverage based on it ends during the IEP.2 George's real deadline was the last day of his IEP, December 31, 2021. He did not enroll until January 2023, after COBRA ended, expecting that the post-COBRA SEP would apply.

CMS denied the SEP claim because COBRA does not extend the GHP SEP. George's enrollment was processed through the January 2023 GEP, with coverage starting February 1, 2023 (under the new BENES Act rules effective January 2023). His delay from the end of his IEP (December 31, 2021, three months after his September 2021 birth month) through February 2023 is 14 months, which produces a 10% LEP (one full 12-month period). George's 2026 monthly Part B cost is $202.90 + $20.29 = $223.19.1

George's income of $4,200 per month from pension and Social Security exceeds Georgia MSP limits, so the Section 1839(b)(3) Buy-In exemption is not available to him. He explored Equitable Relief but did not have written documentation of any specific SSA misinformation; his belief about COBRA came from his firm's benefits administrator, not from SSA. SSA denied the Equitable Relief request. George pays the $20.29 monthly LEP for as long as he keeps Part B. A Georgian in George's position today has one more card than George did: the exceptional-conditions SEP at 42 CFR 407.23(c), in force since January 1, 2023, treats incorrect information from an employer or its group health plan as its own category, and it is worth raising with SSA by name.7 Over 20 years of retirement, his cumulative LEP cost is approximately $4,870 (using a flat 2026 dollar value; the actual figure rises as the standard premium rises). This was an avoidable LEP, and is the single most common LEP trap in Georgia.11

Linda 73 Macon: active GHP SEP works perfectly

Linda continued working as a school administrator in Macon past age 65. She turned 65 in March 2018 and continued active employment through August 2025, when she retired. Throughout this period, she remained covered under the Bibb County School District GHP, which has well over 20 employees. Linda's daughter, a GeorgiaCares SHIP volunteer, had reviewed Linda's options at age 65 and confirmed that the GHP SEP applied and that Linda could safely delay Part B enrollment without LEP.

When Linda retired in August 2025, her 8-month SEP started September 1, 2025 and ran through April 30, 2026. Linda enrolled in Part B in October 2025 with coverage starting November 1, 2025, three months before her actual retirement-coverage gap (her active employment GHP continued through August 31, 2025, after which she switched to a Bibb County retiree health plan that wraps with Medicare). Her 2026 monthly Part B cost is $202.90 with no LEP. Linda is a textbook example of how the GHP SEP is supposed to work for Georgia retirees who continue working past age 65 with large-employer coverage.1

A few details from Linda's case are worth highlighting. First, she documented the GHP SEP eligibility by completing Form CMS-L564 (Request for Employment Information), which her employer's HR office signed. Second, she enrolled through SSA directly, not through her retiree plan administrator. Third, she did not enroll in COBRA between her active employment and Medicare effective date; she went directly from active GHP to Medicare to retiree wrap coverage. Fourth, the daughter's SHIP training was invaluable in avoiding the COBRA trap that befell George in the previous example.

Robert 69 Augusta: Equitable Relief approved

Robert turned 65 in February 2022 in Augusta. He was not collecting Social Security at that time (he had planned to delay retirement to age 70 to maximize his benefit). In December 2021, Robert visited his local SSA office to ask about Medicare enrollment. The SSA worker told him that since he was still working with employer coverage and not yet collecting Social Security, he did not need to enroll in Medicare yet and that the system would notify him when he needed to enroll. This was incorrect: even beneficiaries not collecting Social Security must enroll in Part B during the IEP at age 65 if they want to avoid LEP, unless they qualify for a SEP, and Robert worked for a small employer (12 employees), where Medicare pays primary and delaying Part B leaves the worker exposed.5

Robert worked another two years before retiring in February 2024. After retirement, he applied for Social Security and Medicare in March 2024. SSA processed his Part B enrollment through the March 2024 GEP. Because the post-2023 rules were already in force, his coverage started April 1, 2024, the first day of the month after he enrolled, and not the July 1 start the pre-2023 rule would have imposed. His delay ran from the end of his IEP on May 31, 2022 through his March 2024 enrollment: 22 months, which is one full 12-month period, so his LEP was 10%.2,1

Robert's daughter, who works as a benefits consultant, immediately recognized the error and helped Robert prepare an Equitable Relief request. The request described the December 2021 SSA visit, named the worker who provided the incorrect advice, and included Robert's contemporaneous note from his appointment calendar that documented the visit and the substance of the advice received. The local SSA office in Augusta processed the request under the POMS HI 00805.170 criteria: government error, prejudice to Robert's Part B rights, and evidence of the error.3

Equitable Relief was approved in November 2024. The relief granted: Part B enrollment retroactive to February 2022 (Robert's IEP), LEP waived in full, and refund of the LEP amounts Robert had paid from April 2024 through November 2024. Robert's 2026 monthly Part B cost is $202.90 with no LEP. The Equitable Relief outcome was substantially better than the Buy-In exemption would have been (Robert's pension exceeds MSP limits) and represents the ideal outcome when SSA error is well-documented.1

Common Mistakes That Cause Avoidable LEPs

Georgia families lose tens of thousands of dollars in cumulative LEP charges each year because of preventable mistakes. The list below summarizes the most common errors observed by GeorgiaCares SHIP counselors, Atlanta Legal Aid attorneys, and Medicare Rights Center staff.

1. Assuming Medicare enrollment follows Social Security enrollment. They are separate. Delaying Social Security to age 70 does not delay the Medicare IEP. Enroll in Medicare at age 65 regardless of when you claim Social Security.

2. Assuming COBRA extends the GHP SEP. It does not. The 8-month SEP starts when active employment ends, not when COBRA ends. Plan Part B enrollment to coincide with the end of active employment, regardless of COBRA.

3. Treating small-employer (under 20) coverage the way you would treat large-employer coverage. The penalty-free delay described above rests on the plan paying primary, which happens when the employer has 20 or more employees. At an employer with fewer than 20, Medicare generally pays primary, so you typically should enroll at 65 to avoid gaps in coverage. If you are already past 65 at a small employer, ask SSA which enrollment period it will apply to your case rather than assuming the answer.5

4. Assuming retiree coverage qualifies for the GHP SEP. It does not. Only coverage based on current employment qualifies. Retiree coverage is post-employment and triggers the IEP-or-LEP rule.

5. Forgetting to enroll in Medicare when delaying Social Security benefits. Common among professionals working past 65 who plan to claim Social Security at 70.

6. Missing the IEP because of an address change or lost mail. SSA notices and Medicare welcome packets go to the address on file. Update SSA records before approaching age 65.

7. Relying on benefits administrator advice instead of SSA. Private benefits administrators are not authorized SSA agents and incorrect advice from them generally does not qualify for Equitable Relief.

8. Failing to apply for MSP when eligible. The Section 1839(b)(3) exemption is one of the most powerful LEP relief mechanisms and is often missed because beneficiaries do not realize they qualify.

9. Confusing the Part B LEP with the Part D LEP. They are separate. A beneficiary can have both. MSP enrollment exempts the Part B LEP; LIS enrollment exempts the Part D LEP. Both are critical for low-income beneficiaries.

10. Assuming the LEP is fixed at the dollar amount established at enrollment. It is not. The LEP is a percentage and adjusts each year as the standard premium changes.

11. Failing to document SSA error in real time. Equitable Relief requests succeed or fail based on documentation. Take notes during SSA visits, retain notices, and request written confirmation of advice given.

12. Missing the 8-month GHP SEP window after retirement. The window is short. Enroll within 8 months of the end of active employment, not within 8 months of the end of any coverage.

13. Assuming Medicare Advantage enrollment eliminates the LEP. It does not. The LEP is on the underlying Part B enrollment, not on the choice of delivery.

14. Expecting QMB to be backdated. It cannot be: QMB applies only to services furnished after the end of the month DFCS makes the determination. SLMB and QI can reach up to 3 months before the application month, so request those retroactive months on the application.12

15. Giving up after an LEP is assessed. The LEP can sometimes be reduced or eliminated through Equitable Relief, MSP enrollment, or specialized SEPs even years after the initial assessment. Consultation with GeorgiaCares or Medicare Rights Center is free and worthwhile.

Step by Step: How to Avoid or Eliminate a Georgia Medicare Part B LEP

The simplest LEP avoidance strategy: enroll in Part B during the IEP at age 65. If you are collecting Social Security or RRB benefits, enrollment is automatic and you simply confirm your election by retaining the Medicare card sent to you. If you are not collecting Social Security, actively enroll through SSA online (ssa.gov/medicare/sign-up), by phone (1-800-772-1213), or in person at a local SSA office.4 Begin the enrollment process three months before your 65th birthday to ensure coverage starts on the first day of your birth month.

If you are working past 65 with active employment GHP from a large employer (20+), confirm with your HR office that the employer is in fact 20+ in size and that the GHP is based on active employment, not retiree coverage. Document this in writing (Form CMS-L564 signed by HR). At the end of your active employment, enroll in Part B within the 8-month SEP. Plan the transition to avoid relying on COBRA as a bridge; if COBRA is necessary, enroll in Part B during the SEP window even while still on COBRA.

If you missed the IEP and no SEP applies, your enrollment vehicle is the GEP (January 1 through March 31). Coverage starts the month after enrollment under post-2023 BENES Act rules. The LEP applies. Determine your LEP percentage by counting full 12-month periods between the end of your IEP and the GEP enrollment date. Multiply by 10%. Apply to the standard Part B premium.1

If you face an LEP and have limited income and assets, apply for a Medicare Savings Program through DFCS via Georgia Gateway (gateway.ga.gov), by paper application from your local DFCS office, or with help from a certified Georgia SHIP (GeorgiaCares) counselor, reachable Monday through Friday, 8 a.m. to 5 p.m., at 1-866-552-4464, option 4.8 Approval triggers the State Buy-In, which under Section 1839(b)(3) exempts you from LEP charges for the duration of MSP enrollment. The exemption applies to QMB, SLMB, and QI; QDWI covers only the Part A premium and does not eliminate the Part B LEP.11

If the LEP resulted from SSA or CMS error, file an Equitable Relief request through your local SSA office. Include documentation of the error, contemporaneous notes, witness statements, and any written notices that reflect the misinformation. Request specific relief (retroactive enrollment, LEP waiver, or both). GeorgiaCares can help with preparation; for complex cases, contact Atlanta Legal Aid Senior Citizens Law Project (404-377-0701) or Georgia Legal Services Program (1-800-498-9469).13

How Georgia DFCS, DCH, and Federal Agencies Coordinate on LEP Issues

The Georgia Department of Community Health (DCH) administers Medicaid and the Medicare Savings Programs. The Division of Family and Children Services (DFCS) accepts applications, determines eligibility, and codes the MSP into the Medicaid Management Information System (MMIS). The State Buy-In Agreement between DCH and CMS is the operational backbone of the Section 1839(b)(3) LEP exemption: when DCH MMIS shows an active QMB/SLMB/QI enrollment, the COBA daily file transmits an accretion to CMS, CMS updates the federal beneficiary record, SSA stops withholding the Part B premium from the Social Security check, and the LEP surcharge is suppressed for as long as the Buy-In remains active.

SSA administers Part B enrollment, processes Equitable Relief requests under Section 1837(h), and runs the Medicare enrollment system end-to-end through its field offices, teleservice centers, and online portal. SSA workers are the front line for LEP-related inquiries and the most common source of both correct guidance and (occasionally) incorrect guidance that triggers Equitable Relief. SSA does not determine MSP eligibility; that is DFCS's role. SSA does notify CMS of LEP determinations, retroactive enrollment decisions, and Equitable Relief outcomes through internal coordination.

CMS administers Medicare nationally, sets the Part B premium each year, processes the LEP calculations on the back end, runs the COBA exchange with state Medicaid agencies, and oversees the Medicare Advantage and Part D programs. CMS does not process individual Equitable Relief requests; that is SSA's role. CMS notifies beneficiaries of Part B enrollment changes through monthly notices and the annual Medicare and You handbook.

GeorgiaCares, the State Health Insurance Assistance Program (SHIP) for Georgia, is the free counseling resource for Medicare beneficiaries and is the single most useful starting point for any LEP issue. GeorgiaCares counselors can help beneficiaries understand their IEP and SEP options, prepare Equitable Relief requests, file MSP applications, and resolve disputes with SSA and CMS. The SHIP network is funded by the federal Administration for Community Living and is independent of insurance companies, providers, and plan sellers. GeorgiaCares is administered through the Georgia Division of Aging Services and reaches Georgians through Area Agencies on Aging, senior centers, and direct outreach.

The Bottom Line for Georgia Families

The Medicare Part B Late Enrollment Penalty under Section 1839(b) of the Social Security Act and 42 CFR 407.20 is a permanent surcharge that adds 10% of the standard Part B premium for each full 12-month period of delay beyond the Initial Enrollment Period. The penalty was created in the original Social Security Amendments of 1965 (PL 89-97) and has been refined by OBRA 1989, BBA 1997, MMA 2003, MIPPA 2008, the 21st Century Cures Act 2016, and most recently the BENES Act 2020. The penalty is calculated as a percentage applied to the standard premium each year (not fixed at the time of delay), is permanent unless removed through specific relief pathways, and rises in dollar terms as the standard premium rises.1

The most important relief pathways for Georgia families are: enrollment during the IEP at age 65 (the simplest prevention), the Working Aged GHP SEP (for beneficiaries with large-employer active GHP coverage), the Section 1839(b)(3) Buy-In exemption (for QMB, SLMB, and QI enrollees), and Section 1837(h) Equitable Relief (when SSA or CMS error caused the delay). The Section 1839(b)(3) exemption is especially powerful for low-income Georgians and is often missed because beneficiaries do not realize that MSP enrollment effectively wipes out the LEP for as long as MSP eligibility remains.

For Georgia families facing an LEP today, the action steps are: first, determine whether an exemption pathway applies by reviewing the SEPs, MSP eligibility, and Equitable Relief criteria; second, file an MSP application through DFCS if income and assets fit; third, prepare and file an Equitable Relief request if SSA or CMS error caused the delay; fourth, work with GeorgiaCares SHIP for free counseling and application assistance; fifth, document everything in real time to support any future relief request.

Brevy publishes deep-dive Medicaid and Medicare guides for Georgia families navigating eldercare, including comprehensive coverage of the Medicare Savings Programs, Medicare Buy-In, dual-eligible programs, and Part D Low Income Subsidy that together protect millions of low-income Georgians from out-of-pocket Medicare costs.

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The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.