Signing Up for Medicare: What You Need to Know

Is your 65th birthday looming? If so, you are in good company: for about the next decade, 10,000 people every day will reach that milestone in the United States, which will qualify them for Medicare. If you are approaching the age of Medicare eligibility, there are some things you need to know about enrolling in Medicare.

Do I Have to Do Anything to Sign Up for Medicare?

You might. If you are already receiving Social Security benefits as you approach 65, you will be automatically enrolled in Medicare Parts A (hospital insurance) and B (physician fee coverage). If not, you will need to sign up during your initial enrollment period.

When is My Initial Enrollment Period?

Your initial enrollment period begins three months before you turn 65, includes the month you turn 65, and extends for three months afterward. If you are not already receiving Social Security benefits, you will need to take some action during the initial enrollment period in order to get Medicare. You can call the Social Security Administration at 1-800-772-1213 to get started, or go online to enroll.

While you can sign up anytime during your initial enrollment period, you should really do it as soon as possible, to ensure that you begin receiving benefits the moment you are eligible to.

Do I Need to Sign Up for Medicare if I’m Still Covered Through an Employer?

If you’re like many people these days, you may still be working as you approach your 65th birthday. If that’s the case, and you have health insurance through an employer or union group, you may not need to sign up for Medicare Part B right now. Contact your employer to learn if your health insurance plan through your employer is considered your primary insurance. If not, and Medicare is considered the primary insurer, then you will need to enroll in Medicare Part B. Whether or not you need to sign up for Medicare B right now, you should still go ahead and enroll in Medicare Part A. If you are hospitalized, Medicare Part A may cover part of your bills that are not covered by your employer’s plan.

Be aware: COBRA coverage, such as you might receive from an ex-spouse in your divorce settlement, is NOT considered a health insurance plan for purposes of Medicare, and neither do VA benefits or retiree coverage. In order to not need Medicare part B, you must be covered by health insurance through an employer where you actively work now, and that employer must have 20 employees or more.

What Happens if I Fail to Sign Up for Medicare Part B During Initial Enrollment?

If you don’t sign up for Medicare Part B when you should have, you may be subject to a penalty. Specifically, your premium for Medicare Part B could go up 10 percent for each 12-month period in which you could have had coverage, but did not. You will also need to wait until the annual Medicare open enrollment period to enroll. This period is usually open between January 1 and March 31 every year.

Once I Have Enrolled in Medicare, Do I Need to Enroll Again?

No. Once you are enrolled in Medicare, you are enrolled for life. However, that doesn’t mean that you will not want to take advantage of the annual open enrollment period. There may be changes to the various options from year to year, and you may find that a new plan better meets your needs. You can change coverage during the open enrollment period.

Does Medicare Cover All My Medical Bills?

Unfortunately, no. As with insurance you had while employed, there are co-pays, deductibles, and exclusions from coverage. You can, however, purchase another insurance policy to cover some of these costs, commonly called a Medigap policy. Medigap policies are private insurance; you can search for a Medigap policy in your area.

What Are Medicare Part C and D?

Medicare Part C is also called Medicare Advantage. This is what private health care plans operating under Medicare are known as. In order to enroll in Medicare Advantage, you must already be enrolled in Medicare Parts A and B. A Medicare Advantage plan will offer both Part A and Part B coverage for hospital and doctor bills, some drug coverage and may provide additional coverage, including vision, dental, hearing and fitness programs.

Medicare Part D is the name for prescription drug coverage through Medicare. If you are not planning to enroll in a Part C Medicare Advantage plan that offers minimal drug coverage, you should sign up for Medicare Part D when you enroll in Parts A and B. As with failing to sign up for Part B when you are first able to, your Medicare Part D premium will increase every month beyond the initial enrollment period that you fail to sign up. However, you may be able to avoid this penalty if you have “creditable coverage” for prescription drugs from a private insurer. Your insurer can tell you if your plan qualifies as creditable coverage.

We at Mundahl Law hope this information is useful to you as you face this new transition! For help with other life transitions, we invite you to contact Mundahl Law to schedule a consultation.