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Medicare Enrollment
Knowing when to sign up for Medicare doesn’t have to be confusing. Understanding your unique circumstances can help you make the most of the Medicare services and plans available, ensuring that you’re covered and protected during your retirement years.
Finding the right time to enroll in Medicare is a delicate balance. Enrolling too early could leave you spending money you don’t need to while signing up too late will have you paying lifelong penalties. While you may be eligible for Medicare at 65, that doesn’t always mean you have to sign up for Medicare. Learn more about the best time to enroll in Medicare, who can delay Medicare enrollment, and the Medicare enrollment periods you need to know.
When Should I Sign Up for Medicare?
Your and your spouse’s employment status plays a crucial role in determining when to sign up for Medicare. Understanding the various scenarios can help you make a well-informed decision. Here’s what you should know about enrolling in Medicare based on your employment and coverage circumstances.
Can I Have Both Employer Insurance and Medicare?
In short, yes, you can have both employer insurance and Medicare, but there are a couple of caveats.
If you or your spouse are working for a company with fewer than 20 employees, you must enroll in Medicare because these insurance plans move to the second payor position once you’re Medicare eligible.
If you or your spouse work for a company with 20 or more employees, you can delay enrolling in Medicare since your insurance is considered creditable coverage, allowing you a Special Enrollment Period when you’re ready to enroll in Medicare.
However, if you choose to sign up for Medicare Part A and/or Part B, your employer insurance plan will remain the first payor. In this case, the decision to sign up for Medicare depends on the benefits and costs of your employer plan and whether it’s more advantageous than a potential Medicare plan.
COBRA and Medicare
If you have a COBRA plan, you need to start Medicare at 65. While COBRA can provide temporary coverage, it can be costly and unsuitable for long-term needs. Once you become eligible for Medicare, COBRA moves to the second payor position, meaning you’re the first payor unless you enroll in Medicare. Furthermore, COBRA isn’t considered creditable coverage by Medicare standards, so failing to sign up at 65 may result in lifelong penalties and delayed enrollment.
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TRICARE and Medicare
TRICARE insurance is known for its comprehensive coverage, however, if you’re among the military personnel with this insurance plan, you’ll need to enroll in Medicare at 65. TRICARE, like COBRA, assumes the secondary payer role once you reach Medicare eligibility. This obligation extends to eligible members of the military family as well.
ACA and Medicare
When you have an individual health insurance plan through the Affordable Care Act (ACA), you often enjoy tax subsidies and cost-sharing, making this plan very affordable. However, once you turn 65, those perks go away, leaving you responsible for paying the full premiums and covering all out-of-pocket costs. In this situation, it is more logical to transition to Medicare, since you cannot receive subsidies from two separate government programs.
Medicare Enrollment Periods
There are several enrollment periods for Medicare and all of them serve different purposes so be sure to keep an eye on your calendar as you begin thinking about Medicare enrollment.
Medicare Initial Enrollment Period
Perhaps the most common enrollment period, your Initial Enrollment Period (IEP) is the first time you’re eligible to enroll for Medicare. The IEP is the best time to enroll in a Supplemental plan without medical underwriting and enroll in Medicare Part B without penalty.
This enrollment period is 7 months long and starts three months before your birth month and ends three months after your birth month.
Medicare Special Enrollment Period
The Medicare Special Enrollment Period (SEP) is just like it sounds. It’s a special enrollment period that allows you to enroll in Medicare outside your Initial Enrollment Period (IEP). Situations that qualify you for a Special Enrollment Period include moving out of your Medicare Advantage service area, working past 65 with creditable coverage, and losing employer coverage.
The duration of the SEP varies depending on your situation but can be as short as two months and as long as eight.
Medicare General Enrollment Period
Think of the Medicare General Enrollment Period (GEP) as something similar to the open enrollment period on a standard market plan. In fact, this enrollment period is also called the Medicare Open Enrollment Period. From January 1-March 31, those who missed their IEP or don’t qualify for a SEP can sign up for Medicare Part A and Part B. If, however, you have to sign up for Medicare during this time, you may be subject to a lifelong penalty on your Part B premium.
Medicare Annual Enrollment Period
The Annual Enrollment Period (AEP) begins on October 15 and ends at midnight on December 7. The AEP is the time of year to change your Medicare Advantage and Prescription Drug Plans. Any plan changes you make during this enrollment period will take effect on January 1.
What is the Medicare Advantage Open Enrollment Period?
If you’ve heard of the Medicare Advantage Open Enrollment Period, know it’s the same as the Medicare Annual Enrollment Period.
Prepare for Medicare Enrollment with Medicare School
Navigating Medicare enrollment can feel overwhelming, but Medicare School is here to help. We can help you understand your eligibility so you can find the right time to enroll in Medicare based on your situation.
At Medicare School, we are passionate about helping you understand Medicare so you can enjoy retirement. Browse our blog or check out our YouTube channel to learn more about Medicare and Social Security. You can also enroll in our free Medicare Workshop or download our “Complete Guide to Medicare” for a crash course on Medicare before you enroll.
Looking for personalized help? Schedule an appointment with a Medicare guide or give us a call today.
