There are set times during the year, and during a person’s life, when they may sign up for Medicare Part D. In some situations, not signing up for Part D when you are first eligible can lead to future penalties.

Medicare Part D is prescription drug coverage. A person can purchase a Part D plan when they become eligible for Medicare and have either Part A or Part B coverage.

Medicare-approved private insurance companies offer Part D plans. There are two general options for Part D coverage:

  • Stand-alone Part D plans: A person with Part A or Part B can sign up for a stand-alone Part D plan in addition to their Original Medicare coverage.
  • Bundled drug coverage: A person can sign up for a Medicare Advantage plan that bundles Part D coverage with their hospital insurance and medical insurance.

If you have a Medicare Advantage plan that does not include Part D, you cannot sign up for a stand-alone Part D plan. Doing so would disenroll you from your Medicare Advantage plan.

In this article, we discuss when you can enroll in Part D and the potential penalty for not enrolling.

You can only sign up for Medicare coverage, including Part D coverage, during specific periods throughout the year.

Initial enrollment period (IEP)

The first opportunity you’ll have to join a Part D plan is during your IEP. This is a 7-month window that begins 3 months before you first qualify for Medicare. A person will only have one IEP during their lifetime unless they become eligible for Medicare before the age of 65 years due to a disability or chronic health condition.

To join a Part D plan during the IEP, you will need to have either Part A or Part B coverage.

The IEP is the best time for most people to sign up for a Part D plan. If you choose not to enroll during this time, you may face a late enrollment penalty later.

Open enrollment period (OEP)

The OEP is an annual Medicare enrollment period that runs from October 15 to December 7. During the OEP, Medicare beneficiaries can make many types of changes to their coverage.

A person with Original Medicare can join a stand-alone Part D plan, switch Part D plans, or drop their Part D coverage.

A person could also switch from Original Medicare to a Medicare Advantage plan that includes Part D coverage. Alternatively, people with Medicare Advantage can switch to Original Medicare.

Medicare Advantage open enrollment period (MA OEP)

The MA OEP runs from January 1 to March 31. During this time, a person with Medicare Advantage can switch to a new plan or return to Original Medicare.

If they choose to do the latter, they can also sign up for a Part D plan.

Special enrollment period (SEP)

The last type of enrollment period during which a person can sign up for Part D plan is called a SEP. The timing of SEPs varies. People can qualify for an SEP when they experience a life event that affects their insurance coverage.

For example, if a person has health insurance through an employer when they turn 65 years old, they will qualify for an SEP when they lose their employer-sponsored insurance.

Depending on the situation, a person can typically sign up for Part D during an SEP. The length of time they’ll have to do so will vary based on their individual circumstances.

If you sign up for Part D during the IEP, your coverage will begin either when your Part A or Part B coverage starts or on the first day of the month after the insurance carrier receives your request. It depends on when you sign up.

If you sign up for a new Part D plan — or a Medicare Advantage plan that includes drug coverage — during the OEP, your coverage will begin on January 1 of the following year.

If you return to Original Medicare during the MA OEP and sign up for a Part D plan, your coverage will begin at the start of the month after the insurance carrier receives your request.

If you don’t sign up for Part D when you first become eligible, you may face penalties later on when you do go to enroll.

For every month that you go without Part D coverage, you incur a 1% penalty based on the national base beneficiary premium. In 2025, this base monthly premium is $36.78. The penalty gets added to your Part D monthly premium.

Here’s an example: If you chose not to enroll in Part D when you turned 65 years old, and you decided to enroll in a plan when you turned 67 years old, you would have to pay a 24% penalty each month (because you went without coverage for 24 months). This works out to about $8.82, based on the base premium of $36.78.

This is a permanent penalty that you will pay for as long as you have Part D coverage.

You can avoid the late enrollment penalty if you have creditable drug coverage from another source in place of Part D, such as through an employer-sponsored health plan or the Department of Veterans Affairs.

The best time to sign up for Part D to avoid paying penalties is during the initial enrollment period (IEP) when you first become eligible for Medicare.

If you miss the initial enrollment period, you can also sign up for Part D during the open enrollment period (OEP), which is from October 15 to December 7 each year.

However, if you have drug coverage from another source, you will not have to pay a Part D late enrollment penalty.