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Medicare Enrollment Periods
Knowing when to enroll in Medicare is equally as important as choosing your Medicare benefits.
There are several Medicare enrollment periods that you need to be aware of. Taking the time to familiarize yourself with these dates will enable you to have a clear understanding of your benefits, as well as enable you to enroll on time, and avoid the risk of underwriting or incurring a late penalty fee.
Each enrollment period has been created to accommodate various life events and changes. Read below and identify the enrollment period that applies to you.
Understanding these enrollment periods and rules are an integral part of obtaining your Medicare coverage.
If you are currently receiving Social Security/Railroad Retirement Board benefits, you will automatically be enrolled in Medicare Parts A and B when you first become eligible. For most, this is your 65th birthday and your coverage will start on the first of the month of your 65th birthday.
Please be on the lookout for your red, white and blue Medicare card approximately 3 months prior to this date.
NOTE: If you do not want to enroll in Parts A and/or B, you must contact Social Security and make a formal request to decline these benefits.
Initial Enrollment Period (IEP)
For most, this will be the first time to enroll in Medicare Parts A and B benefits. Your Initial Enrollment Period (IEP) is triggered by your 65th birthday and provides you the opportunity to enroll penalty-free in Medicare Parts A and B. IEP is a 7-month window that begins 3 months prior to your 65th birth month, includes your birth month, and the 3 months that follow your birth month.
Also, during this period, you have the opportunity to enroll in a Medicare Prescription Drug plan (Part D). By doing so, you will avoid any late enrollment penalties (LEP) associated with missing your IEP.
For those receiving disability benefits, your IEP lasts seven months and begins three months prior to your 25th month of receiving disability benefits from the Social Security Administration or Railroad Retirement Board (RBB).
Initial Coverage Election Period (ICEP)
Initial Coverage Election Period (ICEP) is a period of time when a person who is new to Medicare can enroll in a Medicare Advantage plan with or without prescription drug coverage (Part D). The time and length of your ICEP depends on whether or not you delay your Part B enrollment.
If you enroll in Part B during your Initial Enrollment Period (IEP) when first eligible for Medicare, your ICEP would then be the same as your IEP for Parts B and D. This is the same 7-month window mentioned above.
If you delay your Part B because you have creditable coverage past age 65, your ICEP would be 3 months before you enroll in Part B and ends the last day of the month before your Part B coverage starts.
If you miss your initial enrollment period, you could incur a late enrollment period (LEP).
You must enroll during your Initial Enrollment Period to avoid paying late enrollment penalties for both Parts B and D.
Medicare Part A also may charge penalties if you sign up after your IEP ends, unless you qualify for a Special Enrollment Period (SEP).
Note: If you miss your IEP for Parts B and D, any penalties incurred would be enforced for the remainder of your life. A Part A penalty will be shorter based on your specific situation.
If you miss your initial enrollment period, you risk going without coverage for a significant period of time.
By missing your Initial Enrollment period, your first available opportunity to enroll in Part B would be the next General Election Period (GEP), which runs from January through March. With this scenario, you could apply for benefits during this time, but your coverage wouldn’t begin until July of that year. Therefore, depending on when your IEP occurred, you could be without benefits for a lengthy period of time.
We strongly recommend that you make every effort to enroll during the three months prior to your 65th birthday to avoid any gaps in your coverage.
Special Enrollment Period (SEP)
CMS understands that life changes and, depending on your situation, you could qualify for a Special Enrollment Period (SEP) to assist in enrolling and managing your Medicare benefits.
An SEP allows you to delay enrolling in Part B and D without incurring a late enrollment penalty (LEP). If you elected not to enroll for Parts B and D during your IEP, you would need to provide documentation of your Special Enrollment Period (SEP) eligibility to CMS in order to avoid any penalties.
Please see below a list of special circumstances that CMS has approved to qualify for an SEP.
✓ Your Medicare plan is withdrawn from the Medicare program.
✓ Moving out of your Medicare plan’s service area.
✓ Residing, moving in to, or moving out of a nursing facility or other institution.
✓ Becoming eligible or losing your Medicaid coverage.
✓ Becoming eligible and receiving Extra Help (also known as Low-Income Subsidy) with your Medicare prescription drug costs.
Special Enrollment Periods For Those Working Past 65
Today, many people are choosing to work past 65. By doing so, you might elect to keep your employer benefits until you decide to disenroll from these benefits or retire. With either scenario, you are eligible for an SEP that would provide you a period of time to enroll in Parts B and D penalty-free.
Prior to determining your SEP eligibility after IEP, you should discuss with your employer how your existing health plan coincides with Medicare enrollment.
According to the CMS, if you work for an employer with under 20 employees, your health plan will be considered secondary and Medicare will become your primary. Therefore, by failing to enroll into Medicare in this situation, you would, by default, become the primary payor of your claims and bills.
If you work for an employer with over 20 employees, your employer benefits would be primary and Medicare would be secondary.
When To Enroll If Working Past 65
If you chose to continue working past 65, you have a delayed Part B scenario that would qualify you for an SEP.
If your employer has under 20 employees, you can apply for Medicare during your IEP or any time during the 8 months after the first month from when you lost employer coverage.
If you work for a larger company with over 20 employees, you can elect to enroll in Medicare Parts B and D anytime whether working or retiring.
Special Enrollment Periods for Parts A and B
Once you no longer are working or after your coverage with your employer ends, you have 8 months to enroll in Medicare Parts A and B. This eight-month period begins the month that your coverage ends or you stop working, whichever happens first. If you wish to start on Medicare Part B after having been on an employer plan longer than age 65, there is a special way to sign up for Part B. Contact us, and we can help you.
Special Enrollment Periods for Parts C and D
This SEP begins the month you no longer have coverage and continues for two additional months. You may choose a plan effective date up to 3 months after the month in which the individual completed the enrollment request.
General Enrollment Period (GEP)
If you didn’t sign up during your Initial Enrollment Period, and you’re not eligible for a Special Enrollment Period, you still have an opportunity to enroll in Parts A and B during the General Enrollment Period (GEP).
This enrollment period is from January 1 through March 31 of each year, and your coverage would start on July 1 of the same year.
During the General Enrollment period, you can enroll for Parts A and B, but must wait for the Annual Enrollment Period (AEP) in October to enroll in Parts C and D.
The GEP is not the ideal time for you to sign up for Original Medicare because you still risk facing late penalties and coverage gaps by enrolling during this period.
That’s why the best time to sign up for Parts A and B is during your Initial Enrollment Period.
Annual Enrollment Period (AEP)
This enrollment period runs from October 15th-December 7th every year. During this period, you can add, change or drop your Medicare coverage depending on your enrollment. Unless you qualify for a Special Election Period, this will be the only time each year you can make changes to your Medicare benefits.
You can use the AEP to:
✓ leave your Original Medicare plan and switch to Medicare Advantage.
✓ leave your Medicare Advantage plan and return to Original Medicare.
✓ leave a Medicare Advantage plan that you’re currently enrolled in and change to another Medicare Advantage plan.
✓ enroll in a Part D Prescription Drug plan.
✓ switch to a different Part D Prescription Drug plan if you’re currently already enrolled in one.
✓ drop your Part D coverage completely, without being penalized, if you have creditable coverage through an employer or other source.
Medicare Open Enrollment Period (OEP)
In 2019, the Medicare Open Enrollment Period (OEP) begun returning and replacing the Medicare Disenrollment Period. Under Medicare OEP, Medicare beneficiaries can make a one-time change to their Medicare Advantage benefits from January 1st – March 31st. This change can only occur one time during the duration of their coverage.
During the OEP, there are two changes that you can make to your Medicare coverage. You can either switch from one Medicare Advantage plan to another Medicare Advantage plan, or you can disenroll from Medicare Advantage and return to Original Medicare, with or without Part D benefits.
Why is Medicare OEP coming back?
Medicare OEP is returning for two reasons. With the Medicare Advantage Disenrollment period, enrollees were only allowed to drop their Medicare Advantage plan and return to Original Medicare. They were not allowed to switch from one Medicare Advantage plan to another.
Additionally, OEP is being reinstated because it was recognized that, because Medicare Advantage plans can be complex, that many beneficiaries were making uninformed decisions when they selected their Medicare Advantage benefits, and then were stuck in a plan that they didn’t like and/or couldn’t afford for an entire year.
Medicare Advantage plans can be complicated, and, without thorough research or the assistance of a Medicare broker, it is easily to overlook important details, such as confirming that a specific doctor is in a plan’s network, or that a specific prescription drug is covered.
The OEP allows a beneficiary a one-time opportunity to rectify that mistake and switch to another plan that better meets their needs.
Medigap Open Enrollment
If you enrolled in Original Medicare when you were first eligible, you can also purchase a Medigap/Medicare Supplement policy to assist in filling the gaps in your coverage.
This enrollment period begins the month you are are 65 and have enrolled in Part B, and lasts 6 months from the date that occurs.
The importance of this enrollment period is that you can secure a Medigap/Medicare Supplement policy without any medical underwriting being required. What this means is if you have pre-existing conditions, you will not be penalized, rated or denied coverage during this enrollment period. Should you miss this enrollment period, you might face these consequences when you apply for a policy in the future.
How To Apply for Medicare Parts A and B
For most, enrollment in Original Medicare is automatic when they turn age 65.
You can expect to receive your Medicare card, as well as a “Welcome to Medicare” packet, in the mail from the Social Security Administration about three months prior to your 65th birthday.
However, if you’re not automatically enrolled, there are four ways to apply:
Please note that COVID-19 has affected how you can apply for Medicare. Please contact us at your earliest convenience so we will help you through this process.
Late Enrollment Penalties
Avoiding penalties is beneficial as Medicare costs are already expensive enough as it is.
If you didn’t sign up during the appropriate enrollment period, you assume the risk of incurring a late enrollment penalty.
An LEP can be added to your monthly premium if you don’t enroll when first eligible. LEP’s can last for your lifetime, so please make sure you understand your enrollment periods and how to comply.
Part A Penalties
Reason for Penalty
You weren’t automatically enrolled in Part A, or didn’t enroll during your IEP.
A monthly premium increase of 10% of the current Part A premium.
Length of Penalty
Twice the number of years you were eligible for Part A but did not enroll.
If you qualify for a Special Enrollment Period.
Part B Penalties
Reason for Penalty
If you didn’t enroll in Part B when you were initially eligible, and you don’t qualify for an SEP.
A monthly premium increase of 10% of current Part B premium, for every 12-month period that you could have had Part B, but did not enroll.
Lenght of Penalty
The duration of your Part B coverage.
If you qualify for a Special Enrollment Period.
Part D Penalties
Reason for Penalty
If you didn’t enroll in a Part D prescription drug plan when you initially became eligible.
A monthly premium increase of 1% of the average monthly prescription drug premium, multiplied by the number of months you could have had Part D, but did not enroll.
Length of Penalty
The duration of your Part D coverage.
If you qualify for a Special Enrollment Period.
If you or your spouse paid 10 years (40 quarters) of income taxes while working, Part A is free for you.
If you have never been employed, or you haven’t worked long enough to have paid 10 years (40 quarters) of income taxes, you can still enroll in Part A, but you’ll have to pay a monthly premium for your coverage.
If you didn’t qualify for automatic enrollment, and didn’t sign up during your Initial Enrollment Period, you’ll be required to pay a late penalty premium for Part A when you choose to enroll.
The penalty is a monthly premium increase of 10% of the current Part A premium. This penalty lasts for the number of years you were eligible for Part A but did not enroll.
If you don’t enroll in Medicare Part B when first eligible, and you don’t qualify for a Special Enrollment Period, you’ll pay a late penalty every month for the duration of your coverage.
The penalty increases your monthly payment by 10% for each 12-month period you went without coverage.
If you decline enrollment in a Medicare Part D drug plan when first eligible for Medicare, you may be forced to pay a late penalty.
If you fail to enroll on time, CMS will impose a penalty of 1% per month for every month you went without creditable Part D coverage. Your penalty will be calculated off of the “National Base Beneficiary Premium” (NBBP), which is $33.06 in 2021. For example, if you did not have Part D coverage for two years (24 months) after first eligible, your penalty would be 24% of the NBBP for the remainder of your life.
This monthly penalty is rounded to the nearest $0.10 and in addition to your Part D premium, as well as any IRMAA obligations.
Part D Creditable Coverage
You can possibly avoid the late penalty under an SEP if you’ve had Creditable Coverage for any period of time after 65. Creditable Coverage is defined as alternative coverage that meets or exceeds Medicare standards.
Examples of Creditable Coverage
✓ Prescription drug coverage through your or your spouse’s job.
✓ Prescription drug coverage through a retirement plan.
✓ Prescription drug coverage through the Veterans Administration.
To avoid paying any of the late penalty fees for Parts A, B, or D, verify your Special Enrollment Period eligibility before deciding to delay coverage.