Do I Have to Pay IRMAA for Medicare Part D If I Don't Have Part D?

When someone asks why Medicare is charging them for Part D, they're usually running into one of two entirely separate charges, and telling them apart matters. The first is the IRMAA-D surcharge, an income-based add-on that only applies if you're actually enrolled in a Part D plan or a Medicare Advantage plan with drug coverage. The second is the Late Enrollment Penalty, a coverage-gap-based charge that applies regardless of income, triggered by going without creditable drug coverage for too long.

If you have no Part D coverage at all, standalone or through Medicare Advantage, you simply don't owe IRMAA-D. There's nothing to surcharge, since the surcharge is layered on top of an actual premium. This is true no matter how high your income is; IRMAA-D cannot exist independent of Part D enrollment.

The Late Enrollment Penalty is the real risk of skipping Part D. If you go 63 or more consecutive days without Part D and without other "creditable" prescription drug coverage (coverage expected to pay, on average, at least as much as standard Medicare drug coverage) after your Initial Enrollment Period ends, you'll generally pay a penalty equal to 1% of the national base beneficiary premium for every full month you went without coverage. For 2026, that base premium is $38.99, so even a two-year gap adds roughly $9.36 a month, permanently, for as long as you carry Part D. This penalty compounds with time and never resets.

Still working past 65 with employer group health coverage that includes creditable drug benefits is the one common, legitimate reason to delay Part D without penalty. As long as the employer coverage is confirmed creditable (your plan administrator has to tell you this in writing each year) and you enroll in Part D within 63 days of that employer coverage ending, no late enrollment penalty applies, regardless of how many years you delayed.

Once you are enrolled in any Part D plan, the IRMAA-D surcharge is added on top of that plan's own premium based on your MAGI from two years earlier, using the same five-tier structure as Part B. This is true even for a plan that advertises a very low or nominal premium; the income-based add-on doesn't care what the plan itself charges. Billing mechanics differ, too: if you're collecting Social Security, your Part B premium and any IRMAA on Part B or Part D are deducted automatically from your check, but the base Part D premium paid to a private insurer often has to be separately enrolled in Social Security withholding through the plan itself, it isn't automatic the way Part B is.

If your motivation for skipping Part D is avoiding the IRMAA-D surcharge, that plan works, but it comes with a much larger downside: full out-of-pocket exposure for any prescription costs, plus a permanent late enrollment penalty if you ever decide to enroll later without qualifying creditable coverage in the gap. For most retirees, even a low-cost Part D plan is cheaper than the long-run cost of the LEP plus uncovered drug costs.

If you're still working with employer coverage, get written confirmation every year that the drug coverage is creditable, and calendar the 63-day enrollment window from the date that coverage ends. Missing that window is what turns a penalty-free delay into a permanent monthly surcharge.

• Confusing the income-based IRMAA-D surcharge with the coverage-gap-based Late Enrollment Penalty; they're triggered by completely different things.
• Dropping Part D to avoid IRMAA without confirming there's no gap that would trigger a permanent late enrollment penalty later.
• Assuming employer drug coverage is automatically creditable without getting the plan's written confirmation each year.
• Assuming Part D premiums are automatically withheld from Social Security the same way Part B is; it usually requires a separate election with the private plan.