Your Financial Future:
Signing Up For Medicare: It's Not Necessarily Automatic
Are you almost age 65? Have you been looking forward to getting the health care coverage provided by Medicare Hospital (Part A) and Medicare Medical (Part B) Insurance? If you have, be sure you know what you have to do to have your coverage start.
First of all, let’s review what these two parts of Medicare cover.
- Part A helps cover in-patient care in hospitals and skilled nursing facilities (not custodial or long-term care). It also helps cover hospice care and some home health care. There is no Part A premium for most people because they or a spouse paid Medicare taxes while they were working.
- Part B (Medical Insurance) helps cover doctors’ services and outpatient care. It also covers some other medical services that Part A doesn’t cover, such as some of the services of physical and occupational therapists, and some home health care. There is a monthly premium for Medicare Part B. But, because Part B requires that you pay a monthly premium, you have the option of turning it down.
- Part D is prescription drug coverage. It is voluntary, but you cannot get prescription drug coverage without it. Part D is offered through private plans that contract with Medicare. Therefore, premiums, copays and deductible levels vary.
You can also choose to join a Medicare Advantage Plan (sometimes referred to as Part C). These are private health care plans approved by Medicare. Medicare Advantage plans must cover everything that Medicare covers, except for hospice care, which Medicare covers whether or not you have an Advantage Plan. Medicare Advantage plans may offer coverage that Medicare does not offer, such as vision and dental. Many, but not all, include prescription coverage.
How Do I Sign Up for Medicare?
In general, a person becomes eligible for Medicare at age 65. If you are already getting Social Security retirement or disability benefits or railroad retirement checks, you will be contacted a few months before your 65th birthday and given the information you need. You will be enrolled in Medicare Parts A and B automatically. If you are not already getting Social Security retirement benefits, you should call (1-800-772-1213) or visit a Social Security office about three months before your 65th birthday to sign up for Medicare. You can sign up for Medicare even if you do not plan to retire at age 65.
What If I Don’t Sign Up at Age 65?
When you first become eligible for Medicare, you have a seven-month period (this is called your initial enrollment period) in which to sign up for Medical Insurance (Part B). A delay on your part will cause a delay in coverage and result in higher premiums. If you are turning age 65, your initial enrollment period begins three months before your 65th birthday, includes the month you turn age 65 and ends three months after that birthday. If you wait until the last four months of your enrollment period, there will be a delay in your coverage.
If you do not enroll in Medicare Part B during your initial enrollment period, you have another chance each year to sign up during a “general enrollment period” from January 1 through March 31. Your coverage begins the following July. However, your monthly premium increases 10 percent for each 12-month period you were eligible for, but did not enroll in, Medicare Part B.
Anyone can enroll in, switch, or drop a Medicare Advantage plan between October 15 and December 7th. Your coverage will begin on January 1st as long as the plan gets your request by December 7th. You can visit www.medicare.gov/find-a-plan for more information on plans in your area. You can also call 1-800-MEDICARE (1-800-633-4227).
Part D The eligibility period is the same as for parts A and B. You may pay a Part D enrollment penalty if there is a 63 day period after the enrollment period in which you have no Medicare drug or creditable coverage. If you qualify for Extra Help, you will not have to pay the penalty.
What if I have insurance through my employer?
If you are 65 or older and are covered under a group health plan, either from your own or your spouse’s current employment, you have a “special enrollment period.” This means that you can delay enrolling in Medicare Part B and not have to wait for the next January through March general enrollment period. You will not have to pay the monthly surcharge for late enrollment either.
The special enrollment period rules allow you to:
1) Enroll in Medicare Part B any time while you are covered under the group health plan based on current employment, or
2) Enroll in Medicare Part B during the eight-month period that begins with the month your group health coverage ends, or the month employment ends—whichever comes first.
If you do not enroll by the end of the eight-month period, you will have to wait until the next general enrollment period, which begins January 1 of the next year. You also may have to pay a higher premium.
After I Sign Up, Does My Coverage Start Right Away?
If you accept the automatic enrollment in Medicare Part B, or if you enroll in Medicare Part B during the first three months of your initial enrollment period, your medical insurance protection will start with the month you are first eligible. If you enroll during the last four months, your protection will start from one to three months after you enroll.