You may have higher premiums for the rest of your life if you sign up for Medicare late.
Medicare becomes available to most people around the time of their 65th birthday. You can be charged a late enrollment penalty for as long as you have Medicare if you don’t enroll during the initial enrollment.
Enrollment in Medicare is available during the following periods:
- Medicare can be enrolled during the seven-month period beginning three months before you turn 65.
- To avoid penalties, enroll in Medicare within eight months of leaving your job or group health plan if you continue to work after 65.
- A six-month enrollment period for Medicare Supplement Insurance begins when you are 65 or older and enrolled in Medicare Part B.
- You can change your Medicare coverage during the annual open enrollment period from October 15 to December 7.
- A participant in a Medicare Advantage Plan can switch plans every year between January 1 and March 31.
Check out these Medicare signup deadlines and late enrollment penalties.
Medicare Parts A and B Deadline
The month that a Social Security recipient turns 65, they are automatically enrolled in Medicare parts A and B. Medicare enrollment will be required for those who have not claimed Social Security.
It is during this seven-month period which begins three months before you turn 65, that you can first enroll in Medicare Part A hospital insurance and Medicare Part B medical insurance. The coverage can begin the first of the month after you turn 65.
Those who don’t enroll in Medicare around the time of their 65th birthday may do between January 1 and March 31 (general enrollment) to get coverage starting July 1. It is possible, however, that you will be charged a late enrollment penalty when your benefit begins. For every 12-month period that you delay signing up for Medicare after becoming eligible for benefits increases, your monthly Part B premium by 10%.
According to Mark Duggan, an economics professor at Stanford University, the penalty is meant to give people a financial incentive to enroll in health insurance as soon as possible rather than wait until they have a negative health event.
If you or your spouse are 65 and are still employed by a company that offers group health insurance, you must sign up for Medicare within eight months of leaving your job.
After you turn 65 and actively work and have coverage, you can enroll in Medicare Part B anytime. When you retire, you will have eight months to do so without paying a premium penalty, according to Medicare and Medicaid Services specialist David Santana. COBRA coverage and retiree health insurance do not allow you to avoid Medicare’s late enrollment penalty.
Medicare Part D Deadline
The initial enrollment period for Medicare Part D prescription drug coverage is seven months, around your 65th birthday, but the penalty is different. You will be penalized if you go more than 63 days without credible prescription drug coverage after becoming eligible for Medicare. It is calculated by multiplying 1% of the “national base beneficiary premium” ($33.06 in 2021) by the number of months you did not have prescription drug coverage after Medicare eligibility. Each year, this amount is added to your Medicare Part D plan. When the national base beneficiary premium increases, your penalty will increase as well.
Medicare Supplement Insurance Plan Deadline
Supplemental insurance plans can cover some of Medicare’s cost-sharing requirements and sometimes services that traditional Medicare does not cover. Medigap enrollment differs from other parts of Medicare. The government requires all private health insurance companies to offer Medicare Supplement Insurance plans to people 65 or older that have Medicare Part B coverage.
According to Ronald Kahan, author of “Medicare Demystified: A Physician Helps Save You Time, Money, and Frustration,” you’re eligible to purchase a Medigap plan with no substantial underwriting during the initial enrollment. If you fail to take Medigap at the time of initial enrollment, insurers can use medical underwriting/health status to determine how much to charge for the policy and may even reject individuals that they don’t want to provide cover for. Missing the open enrollment period may prevent you from purchasing Medicare Supplement Insurance, and if you are able to purchase the extra insurance, you can find yourself paying much higher premiums. Additionally, you may have to pay significantly more if you have any health problems. Changing Medicare Supplement Insurance plans might not be possible later on, so choose carefully while open enrollment is still available. After you’ve been on a supplemental plan for a while, say you get sick, the plan you’re on must keep you, but another plan does not have to take you.
Medicare Open Enrollment Deadline
Open enrollment for Medicare takes place from October 15 to December 7, and you can make changes to your coverage. During this period, you may join or drop a Medicare Advantage Plan; you can change your Medicare Part D prescription drug plan or drop your Medicare Advantage Plan. The changes made during this period will take effect on January 1 of the following year.
Medicare Advantage Open Enrollment Deadline
Between January 1 and March 31, Medicare Advantage Plan participants have the option of switching to another Medicare Advantage Plan or dropping their Medicare Advantage Plan and returning to Original Medicare. A new plan will start on the first of the month after your request is received. You are only allowed one change per year during this period.