Medicare Part B Keep-or-Drop Calculator

The Part B decision is one of the most consequential choices you'll make before moving abroad. Drop it and save $202.90/month — or keep it and avoid a permanent penalty if you ever return. The math is counterintuitive. Use this calculator to see exactly what it means for your situation.

Figures reflect 2026 Medicare rates published by CMS. Premiums change annually — verify current amounts at medicare.gov.

Kelly Milligan, founder of Expat Retire Guide

By Kelly Milligan

Published June 7, 2026

Just want the framework, not the numbers? This calculator handles the math. For the full keep-or-drop decision framework — including the abroad exception, how to actually disenroll, and what it means if you're on Medicare Advantage — read the Medicare Part B abroad guide.

Your situation

Are you planning to return to the US permanently?

No — I'm leaving for goodMaybe — not sure yetYes — I plan to return

Years abroad before returning5 years

1 year20 years

Your current age65

6285

The math

Saved while abroad

$12,174

$202.90/mo × 60 months

Penalty if you return

+$101/mo

$1,217/year — every year, forever

Post-return monthly premium

$304/mo

vs. $203/mo if you keep it now

Penalty exceeds savings

Age 80

~10 years after you return at 70

Verdict

Lean toward keeping Part B.

You'd save $12,174 while abroad. If you return at 70, the $101/month penalty costs more than you saved about 10 years later — by age 80. With return on the table, that's a real risk.

Uses the 2026 Medicare Part B standard premium of $202.90/month. Premiums adjust annually — verify current amounts at medicare.gov before making decisions. For planning purposes only — not financial or legal advice.

How the Part B penalty actually works

The penalty is 10% of the standard base premium for every 12-month period you went without Part B after first becoming eligible. Two things make it unusually painful:

It's permanent. Every month you pay Part B for the rest of your life, the penalty is on your bill.
It applies to the base premium only. If you pay an IRMAA surcharge for higher income, the penalty is calculated on $202.90 — not your full premium.

The break-even is always 10 years after you return. That's not a coincidence — it's baked into the math. The penalty rate (10%/year) and the savings rate (100%/year) are in a fixed ratio. What changes is the dollar amounts, not the timeline.

This is why the decision comes down to one question: how confident are you that you're not coming back? "Very confident" — the savings are real and yours to keep. "Mostly confident" is a different answer. The penalty is permanent; your certainty isn't.

Common questions

Why is the break-even always 10 years, no matter how long I was abroad?

The math locks in because the penalty and the savings are proportional. The penalty is 10% of the base premium per year abroad. So if you were abroad 5 years, you saved 60 months of premiums and owe 50% more per month forever. Divide savings by the annual penalty: the years cancel, and you're always left with 1 ÷ 0.10 = 10. The dollar amounts change with how long you were abroad — the ratio doesn't.

Does the penalty apply to my IRMAA surcharge?

No. The late enrollment penalty applies only to the standard base premium ($202.90/month in 2026), not to the income-related IRMAA surcharge you may pay on top. If you pay $350/month total, the penalty is calculated on $202.90 only. That means higher earners actually have a slightly more favorable break-even — their penalty is smaller relative to their total bill.

What if I never return to the US? Is there really no penalty?

Correct — the late enrollment penalty only applies when you re-enroll in Part B. If you never re-enroll, you never pay the penalty. The savings are yours to keep. The catch: if you ever change your mind and return, the penalty attaches at re-enrollment and follows you for life. This is why documenting your time abroad matters — there's a narrow exception for people who were living abroad when they first became eligible for Medicare.

What's the abroad exception, and can I count on it?

If you were living outside the US when you first became eligible for Medicare at 65 and weren't receiving Social Security, you may qualify for a penalty-free enrollment window when you return. The window is only 3 months, and you'll need documentation: passport stamps, lease agreements, foreign tax records, or utility bills in your name. Don't plan around this exception — it's narrow, documentation-dependent, and CMS can deny it. Plan as if the full penalty applies.

Can I drop Part B and pick it back up whenever I want?

Not freely. Re-enrollment is limited to the General Enrollment Period (January 1 – March 31 each year), with coverage starting July 1. That means a potential 7-month gap between when you want coverage and when you get it. If you're returning in November after a health scare, you won't have Part B coverage until the following July. The penalty also attaches permanently at re-enrollment. These timing constraints are part of why 'maybe returning' is a riskier position than it appears.

Sources

2026 Medicare Parts B Premiums and Deductibles — CMS: Standard Part B premium ($202.90/month) used in all calculations.
Medicare Costs — medicare.gov: Late enrollment penalty calculation methodology (10% per 12-month period, permanent, applied to base premium only).
Medicare Coverage for Those Who Live Permanently Outside the United States — Medicare Interactive: Abroad exception to the late enrollment penalty; General Enrollment Period re-enrollment rules.

Ready to understand the full decision framework?

The calculator shows you the numbers. The Part B guide covers the abroad exception, how to actually disenroll, what to do if you're on Medicare Advantage, and how to document your time abroad.

Read the Part B Guide