The optimal time to enroll in Medicare is when you approach 65. That milestone birthday is in the middle of what is called your initial enrollment period (IEP), which runs from three months before you turn 65 through the three months after. Generally, if you don’t sign up during your IEP, you’re out of luck unless you take advantage of one of the following two other enrollment periods.
- Special enrollment period (SEP) This is for individuals who delayed enrolling in Medicare Part B because they were working and had employer insurance or were covered under their spouse’s policy. Part B covers doctor visits, lab tests and other outpatient services, and Medicare beneficiaries pay a monthly premium for that care. Many people sign up right away for Part A, which covers hospitals costs, because there is no premium for that coverage for the vast majority of 65-plus Americans.
- Those age 65 or older who lose employer-based coverage are eligible for an SEP that lasts until the month after their health insurance ends or eight months (whichever is sooner) to enroll in Part B.
- General enrollment period (GEP) This is an opportunity for people to sign up for Part B if they didn’t enroll when they first became eligible and they don’t qualify for an SEP. This chance to sign up began Jan. 1 and ends March 31.
Two important things to remember: First, if you enroll during this period, your coverage won’t take effect until July 1. Second, according to Medicare law, when you enroll during the GEP, you have to pay a late-enrollment penalty. That means you’ll pay an extra 10 percent per month for your premium for every year that you delay enrolling. So, say you turned 65 in March 2018 but wait until March 2020 to enroll, your Part B monthly premium will be 20 percent higher for the rest of your life.
“Time and time again we hear from callers to our National Consumer Helpline who missed their enrollment period for Part B, often because of confusion about how employer and retiree health insurance coordinates with Medicare,” says Mitchell Clark, director of digital strategy and communications at the Medicare Rights Center. “Enrollment mistakes can be costly, resulting in gaps in health coverage and a lifetime of paying Part B premium penalties. To prevent further delay in Medicare coverage, eligible individuals should enroll before the March 31 deadline."
March 31 is also the deadline for people who are enrolled in Medicare Advantage to either switch to another MA plan or to original Medicare in 2019. This Medicare Advantage open enrollment period runs from Jan. 1 through March 31 each year, and the changes you make take effect the first of the month after you enroll. Beneficiaries who switch into original Medicare will also be able to sign up for a Part D prescription drug plan.
Two important things to remember: First, you cannot go from original Medicare to an MA plan during this open enrollment period. And second, if you switch from MA to original Medicare, you won’t automatically be able to buy a Medigap policy. If you apply for a Medigap policy when you are first eligible for Medicare, you cannot be denied coverage or charged a higher premium because you have a preexisting condition; that guarantee does not apply if you are switching from an MA plan to original Medicare.