Medicare enrollment is a key event that occurs age at 65 for most people. Even with this date in mind, the timeline and enrollment process can be confusing. Moreover, deadlines are critical and missing key dates could result in ongoing penalties or loss of important rights. In this article, we outline important dates and the process for signing up for Medicare.
When do I need to enroll in Medicare?
The 7-month initial enrollment period (IEP) begins 3 months before your 65th birthday month, includes your birth month, and ends 3 months after the month you turn 65. Most people must enroll in Medicare during the Initial Enrollment Period or penalties will apply. You should enroll in Medicare at age 65 even if you are planning to delay Social Security Retirement benefits to 66 or later. Remember that enrolling in Medicare and filing for Social Security Retirement benefits are completely different processes even though they are both processed through the Social Security Administration.
If you were working when you turned 65 and were covered by your employer’s health insurance, you may be eligible to enroll in Medicare during a special enrollment period. When your employer coverage ends, usually when you leave your job or retire, you have a special enrollment period for 8 months for Medicare Part A and B and 63 days for Medicare Part C and D.
If you missed either the initial enrollment period or special enrollment period, you can still enroll in Medicare during the general enrollment period that takes place each year from January 1 to March 31. However, penalties will most likely be added to the cost of your monthly premiums.
Penalties:
You may owe a late enrollment penalty if you go without one of the following for 63 days or more after your Initial or Special enrollment period:
1. A Medicare Part D plan (Prescription Drug Plan)
2. A Medicare Advantage Plan (also called Part C) that includes prescription drug coverage.
The big bummer here is that you pay this penalty for as long as you have the Medicare drug plan. The penalty amount depends on how long you went without Medicare drug coverage.
“Guaranteed Issue” rights are another critically important benefit to understand and be sure to take advantage of. When you enroll during the initial enrollment window, guaranteed issue rights ensure that you are eligible for the plan regardless of any pre-existing conditions.
How Do I Sign Up for Medicare?
Enrollment in Medicare is not automatic. You should contact the Social Security administration to enroll in Medicare during your enrollment period. If you are already receiving Social Security retirement benefits and are under the age of 65, you will automatically be enrolled in Medicare Part A and Part B when you turn 65, but enrollment in Medicare Part D (prescription coverage) or a Medigap policy is not automatic.
To enroll in Medicare, you may visit your local Social Security office or apply online at ssa.gov.
For an online application:
1. First be sure to create an account at ssa.gov. To create your personal account, they will ask questions to verify your identity. According to the Social Security Administration (SSA), when setting up your “My Social Security Account” for security questions they may ask for mobile phone number, credit card info, tax information like W-2s or other tax forms.
2. Once you have an account created, you will apply for Medicare at https://secure.ssa.gov/iClaim/rib. You will need to provide your date and place of birth as well as current health insurance information.
The Medicare enrollment application will guide you through the process. However, the more difficult decision is picking which option you want:
1. Medicare Original with optional Drug Coverage and a Medigap policy to help you fill in the gaps in the Medicare Original plan, OR
2. A Medicare Advantage Plan.
Once you decide which of those two options then you will need to make additional decisions as follows:
1. For Medicare Original, you will need to choose from one of eight Medigap policies offered or which Medicare Part D (prescription drug coverage) you want.
2. For Medicare Advantage, you will need to choose from a myriad of options. For those of you nearing age 65, you have no doubt been inundated with ads for these plans.
Need some help?
Navigating through the enrollment process can be complicated. If you need any help as you make these retirement health care decisions, please let us know. We at Cedarstone Advisors want you to be confident and comfortable with your health care in retirement, and we are happy to help.