Medicare Enrollment Periods Explained
Are you aware of your Medicare enrollment periods? Chances are, if you’re like most people, you have no idea. But that’s ok! The Medicare enrollment periods can be confusing, but they’re important to understand if you’re eligible for Medicare. According to a 2012 Medicare Rights Center report, about 700,000 people were fined for late enrollment in Part B that year.
The late enrollment penalty is 10% of the Part B premium for each year that a person might have gotten Part B but did not sign up. If you delay enrolling in Part B, you may be subject to a late enrollment penalty for the duration of your Medicare coverage.
The good news is that several “special enrollment periods” (SEPs) allow you to sign up for Medicare outside of the regular enrollment period. You can enroll in Medicare anytime if you qualify for a SEP. Here’s a quick rundown of the various enrollment periods and when they occur.
Initial Enrollment Period for Medicare
The Medicare Initial Enrollment Period is a seven-month period during which people aged 65 and up can sign up for Parts A and B for the first time. For example, you have three months before your birthday month, the month of your birthday, and three months after the month you turn 65 to join Medicare. The same 7-month period is used to enroll in a Medicare Advantage or Part D plan.
You can sign up for Part A and Part B if you have End-Stage Renal Disease (ESRD). If you have ESRD and meet additional qualifications, you can also enroll in a Medicare Advantage Plan. If you are eligible for Medicaid, you have automatically enrolled in Parts A and B the month your coverage begins. You’ll receive a notification in the mail when your coverage begins.
For example, if you reach age 65 on May 20, your Medicare IEP will end on August 31. There is one excuse: if your birthday falls on the first of the month, your IEP will start one month early. For illustration, if you were born on April 1, your IEP would begin on December 1, and your Medicare coverage would begin one month earlier on March 1. During the IEP, you can choose between Original Medicare (Parts A and B) and a Medicare Advantage plan (Medicare Part C). Enrolling during your IEP prevents you from incurring a late enrollment penalty.
You may also avoid late Part D penalties by enrolling in drug coverage during the same period. Drug insurance can be acquired separately, or as part of a Medicare Advantage plan that covers Part D. If you enroll in Original Medicare, you may want to add a Medigap policy (a Medicare Supplement Plan) to offer additional coverage. You will use your Medicare Supplement Open Enrollment Period for this. This six-month period begins when your Part B coverage is activated.
To enroll in a Medigap policy using the Medigap OEP, do the following:
- You cannot be denied a Medigap policy in your location because of your health condition.
- Your medical history or previous diseases will not cause you to pay more for insurance.
- To avoid going without insurance, you must start the application process before your coverage begins.
What if I Don’t Enroll During My Initial Medicare Enrollment Period?
Suppose you do not participate in Medicare during your IEP. In that case, you may be subject to late enrollment fines if you participate later. If you want to enroll later in Part A, there is no late enrollment penalty if you receive premium-free Part A. However, suppose you did not have creditable coverage. In that case, you may have to pay a late enrollment penalty for Part B, and Part D. Creditable coverage is healthcare that is as good as, if not better than, Medicare.
If you lacked creditable coverage and delayed enrolling in Part B, you may be subject to a late enrollment penalty. You must pay this penalty for the duration of your Part B coverage. For example, suppose you did not enroll in Part B during the applicable 12-month period. In that case, you will be fined 10% of your yearly coverage for each year you went without coverage. The typical premium for Part B is $170.10 in 2022, which means you’ll pay an extra $17.01 per month. Another example is if you went without Part B coverage for two years, your penalty would be 20% of your Part B premium.
Part B enrollment may also have to wait until the General Enrollment Period. The penalty for not having prescription drug insurance is 1% every month. The national base price is now around $33 per month, so if you go a year without coverage, you’ll pay an extra $3.96 per month (or possibly more if the Part D base cost rises) as long as you have coverage.
If I Don’t Follow My IEP, When Can I Get Medicare Advantage or Medicare Part D?
Only during the Annual Enrollment Period (AEP), which runs from October 15 to December 7 every year, can you enroll in a Medicare Advantage Plan or Medicare Part D. During this time, you can select a Part C Medicare Advantage Plan or Part D prescription drug plan.
You must switch from one Medicare Advantage Plan to another or from a Medicare Advantage Plan to Original Medicare during the Medicare Advantage Open Enrollment Period (MA OEP). Every year, from January 1 to March 31, the MA OEP is in effect.
What is the General Enrollment Period for Medicare?
The General Enrollment Period is when people who missed their IEP and didn’t qualify for special enrollment periods can enroll in Medicare Part A or Part B. This period starts on January 1 but ends on March 31 each year – so make sure to apply before your coverage begins.
You may think that this means you get safety net insurance because it applies to Original Medicare as well; however, there are still late enrollment penalties. In addition, the GEP only applies to Original Medicare, meaning any plans, including Medicare Advantage plans, will have their deadlines with specific timing requirements.
If you enroll in Original Medicare during the GEP, your Medicare Part A and Part B will become effective July 1. However, make sure you don’t delay electing a Part D plan or a Part C plan if you want one. You must apply before July 1 for a July 1 effective date. However, suppose you don’t apply before July 1 for a Part C or D plan. In that case, you will have to wait until the Annual Enrollment Period from October 15 to December 7, and coverage won’t become effective until January 1 the following year.
What is Medicare Advantage Open Enrollment Period?
That is a particular enrollment time for Medicare Advantage plan holders who want to discontinue their coverage. However, you can change to a new MA plan or enroll in Original Medicare with a Part D plan between January 1 and March 31.
If you decide to return to your Original Medicare after shopping for a Medigap policy, keep in mind that it isn’t guaranteed. For example, you may be required to answer health-related questions for the Medigap plan, and the carrier is not required to accept you in many instances.
- What is Medicare Special Enrollment Period?
A Special Enrollment Period is set aside for beneficiaries who have met specific conditions. For example, suppose you delay Medicare past age 65 due to having creditable employer health coverage. In that case, you may apply for Medicare A and Part B during this enrollment period. Special Election Periods (SEP) for Medicare Advantage and Part D programs operate concurrently with the normal election period. You will have a two-month window to join either a Medicare Advantage plan or a Part D plan if you experience a qualifying event.
- What is the Medigap Open Enrollment Period?
When you first join Medicare Part B, you have six months before the end of the month in which you reach age 65 and six months after that to enroll in a Medigap policy without having to answer medical questions. However, suppose you do not have a qualifying event and are outside of the enrollment period. In that case, you may be required to answer health questions to enroll in a Medigap policy.
