Are you starting Medicare this year? If so, you’re likely trying to navigate through the Medicare maze. There are several enrollment periods and penalties to be aware of before you apply for Medicare. It can be a lot to figure out when you’re researching yourself. However, here is a mini-guide for you to follow while starting your Medicare enrollment this year.
Will You be Automatically Enrolled?
Some people can be automatically enrolled in Medicare. If you receive Social Security Disability Income for at least tweenty four months, Social Security will automatically enroll you in Medicare Parts A and B.
Additionally, if you receive Social Security benefits or Survivor benefits for at least four months before your 65th birthday month, you’ll be automatically enrolled in Medicare. You’ll receive your card about 3-4 months before your birthday month.
When to Apply for Medicare
Most people will enroll in Medicare when they turn 65. Every qualifying beneficiary has a 7-month Initial Enrollment Period to apply for Medicare Parts A and B. The window starts three months before your 65th birthday month, and it will end three months after. When you apply within the first 3 months, your benefits will be effective on the 1st of your birthday month. However, your coverage can be delayed when you apply during the three months that follow your birthday month.
If you are actively working for an employer with less than 20 employees, you’ll want to enroll in Medicare during this 7-month window because small employer insurance is not creditable coverage Medicare. That health insurance will be secondary to Medicare. Additionally, you’ll want to enroll in Medicare during this window if you have retiree coverage, VA benefits, or Tricare for Life.
Are You Working for a Large Employer?
When you actively work for an employer with more than 20 employees and are covered by their insurance, you can delay Medicare past your 65th birthday with no penalty. Once you lose the employer coverage, whether voluntary or involuntary, you will have 8-months to apply for Medicare. The 8-month window is called a Special Enrollment Period (SEP).
You will need to submit CMS form 40B and CMS L564 to Social Security when you want to apply. CMS L564 will need to be filled out by the employer as it proves you had creditable coverage while you delayed Medicare. You’ll notate the effective date you are looking for on the CMS 40B form.
What if You Miss Your IEP and SEP?
When you fail to enroll in Medicare during your IEP and don’t qualify for the SEP, you will sign up during the General Enrollment Period (GEP). The GEP window is from January 1- March 31 of every year. You can enroll during that window, but your Part B coverage won’t start until July 1.
Do You Contribute to a Health Savings Account (HSA)?
An HSA can be a great way to save money for medical needs. However, if you contribute to an HSA and are enrolled in Medicare, the IRS could penalize you. Therefore, if you plan on enrolling in Medicare during your IEP, you will want to stop contributions the day before the 1st of your 65th birthday month. If you delay Medicare due to creditable coverage, you’ll want to stop contributions six months before applying for Medicare.
This also means your employer must stop contributing if they are making contributions.
How to Apply for Medicare
You can sign up for Medicare in several different ways. When applying during your IEP or GEP, you can apply online through the SSA website, phone, or in person. If you apply during a SEP, you will submit the forms via mail, fax, or online.
When Can You Expect Your Medicare Number or Card?
Through your SSA account, you can track the status of your application. Once approved, you can view the Benefit Verification letter through your account, and your Medicare number should be listed in the letter. Generally, your card will arrive in the mail about 2-4 weeks after you have been approved.
What to do Next?
Once you have applied for Medicare, you will want to explore your options since Medicare does not cover all your hospital and medical costs. You can enroll in a Medigap plan and pair it with a Part D drug plan, or you can enroll in a Medicare Advantage plan that includes drug coverage.
You must be enrolled in Part A and Part B to enroll in a Medigap or Medicare Advantage plan.
You have 6-months from your Part B effective date to enroll in a Medigap plan with no health questions. This 6-month window is called the Medigap Open Enrollment. You may need to answer health questions and, therefore, be denied coverage due to specific health conditions when you’re outside that window.
Some states do have exceptions, so it does depend on where you live. Additionally, some states may allow you to switch to a different plan around your birthday or may have year-round open enrollment when you want to change plans. You’ll want to research your state’s rules before you enroll in a plan.
Medicare Advantage and Part D Enrollment
During your IEP, you also have those 7-months to enroll in a Medicare Advantage plan or Part D plan. Suppose you delay Medicare past your 65th birthday due to creditable coverage. In that case, you will be given a 2-month Special Election Period to enroll in an Advantage plan or Part D plan once you lose that coverage.
If you don’t enroll in a plan during those windows, or you want to change your plan, you’ll need to wait until the Annual Election Period in the fall to do so.
These plans are in place for a full calendar year. So, generally, you are locked in from January 1- December 31.
Although it may seem applying for Medicare should be an easy process, there are many things to think of, including when you should apply, how to apply, and what you need to do after you apply. Working with a Medicare broker can be beneficial as they can help guide you through this complicated process.
Read more blog: Everything you should know about medicare advantage