Sometimes, it’s hard to figure out your window for enrollment in Medicare and the best time to sign up.
If you missed your Initial Enrollment Period (IEP) when you turned 65, don’t worry—you have multiple opportunities to apply for coverage throughout the year. One of those opportunities arrives as the ball drops on New Year’s Day 2023.
Once you complete those forms, you can then apply for Part C (Medicare Advantage plans) and Part D (prescription drug coverage) between April 1 and June 30. That way, you can be fully covered beginning July 1.
To help you maximize the benefits and minimize the risks in creating your enrollment timeline, here are answers to some common questions about Medicare enrollment:
Will I be automatically enrolled in Medicare when I turn 65?
Age and disability are the primary criteria that determine Medicare eligibility. Usually, individuals eligible for Medicare due to a disability receive benefits after collecting Social Security for 24 months. Individuals who receive Social Security – either disability or retirement – are automatically enrolled in Part A and Part B. Most other Americans can sign up for Medicare beginning three months before their 65th birthday.
When am I eligible to enroll?
As your 65th birthday approaches, you have a seven-month period in which to enroll in Medicare. Besides your birthday month, you can also apply three months before and three months afterward.
The date your coverage begins depends on when you sign up: If your birthday falls in the first half of the month, your IEP is the seven months surrounding your birthday month. So, if you turn 65 on May 5, your IEP runs from Jan. 1 to July 1. However, if your birthday is May 20, you can enroll from February through August.
If you enroll in the months before your birthday, your coverage begins during your birthday month. For example: If your birthday is in May and you enroll in March, coverage begins in May. If you enroll after your birthday but before the IEP deadline, your coverage begins within approximately three months. So, if you have a late May birthday and enroll in August, the coverage is likely to start in November.
In addition to the birthday-based (IEP) and the national open enrollment (GEP), SEP enrollment periods are triggered by circumstances such as retirement or loss of employer-provided health coverage.
If you are over 65 and you and/or your spouse are still working, it’s likely you’re covered by a job-based health insurance policy. But when you or your spouse stops working or loses group health insurance, Part B SEP allows you to sign up for Medicare without penalty for up to eight months.
Coverage typically begins the first month after you enroll. To avoid a gap in coverage, it’s best to enroll in Medicare the month before your job-based insurance ends.
If you didn’t enroll in Medicare Part B when you became eligible through an IEP or SEP, you can sign up during the GEP between Jan. 1 and March 31 to receive Part B coverage on July 1. Unfortunately in the interim, you may face gaps in coverage and may be assessed a 10% Part B premium penalty for each 12-month period of delayed enrollment.
The good news: While you wait for Part A and B coverage to activate, you can enroll in both a Medicare Advantage and prescription drug plan between April 1 and June 30.
Are there any benefits to Medicare enrollment if my spouse and/or I are still working?
A recent Gallup poll shows the expected age of retirement edging up to 66 as an increasing number of older adults are remaining in the workforce longer.
Employed individuals and their spouses sometimes delay enrolling in Medicare to avoid paying for Part B in addition to group insurance premiums. Fortunately, enrolling in Medicare does not cause workers to forfeit their job-based health coverage.
Enrolling in Medicare does not cause workers to forfeit their job-based health coverage.
Because most older Americans (or their spouses) have worked for at least 10 years, their Medicare Part A premiums have already been paid through payroll deductions. So, there’s usually no reason to delay applying for Part A. That coverage could pay a significant part of a bill if you become hospitalized.
If you enroll in Medicare at age 65, your Part B coverage may pay bills first, and a large portion of the remaining balance may be covered by your employer’s insurer.
What’s the harm in waiting to enroll?
Procrastinating comes with the risk of accruing major, unexpected expenses. It leaves individuals vulnerable to the potential for paying out-of-pocket medical expenses and accumulating penalties for delayed enrollment. In addition, late enrollment in Parts A, B and D can accrue penalties for each month without coverage.
If you’re putting off enrollment because you haven’t had time to thoroughly evaluate all the options, you may want to consider working with a Medicare consultant to save time, aggravation and late fees.
Even if you don’t enroll in a Medicare plan when you first become eligible, there’s always an opportunity to apply for coverage. Whether you and/or your spouse are working or retired, you can typically receive benefits within six months of application. However, waiting to apply can result in penalties and gaps in coverage that can leave you responsible for expensive medical bills.
Now’s the time to review your policies and select the best Medicare plan for a healthy new year.