Medicare Enrollment Period
Part A and Part B Enrollment Periods
Original Medicare Automatic Enrollment
Let’s start with one question. Will you be receiving Social Security Administration (SSA) retirement benefits when you turn 65? If the answer is Yes, then you’ll automatically be enrolled in Medicare Part A and Part B (Original Medicare). Automatic enrollment also applies for those individuals receiving Railroad Retirement Board (RRB) benefits.
If you’re receiving SSA or RRB benefits then your automatically enrolled in Part A and Part B (Original Medicare). The next questions is, when? When does your enrollment in Medicare Part A and B begin? Your benefits will begin the first day of the month of your birthday. As an example, let’s say your birthday is February 10th. As a qualified Medicare beneficiary your benefits will begin February 1st.
Is your birthday on the 1st of the month? Is so, then your benefits will begin the 1st of the month prior to your birthday. For example, if your birthday is February 1st then your benefits will begin on January 1st.
Original Medicare Elective Enrollment
Automatic Original Medicare enrollment is only for those receiving SSA or RRB benefits. In this scenario you will need to sign up for Original Medicare during IEP. The most commonly used Medicare enrollment period is the initial enrollment period (IEP). If you’re turning 65 and eligible for Medicare, then you would enroll during IEP, which a 7 month time frame.
How do you determine your 7 month initial enrollment period (IEP)? Simply add 3 months prior to your birthday month and 3 months after your birthday month. Wait, that’s only 6 months (3+3 = 6). Now add your birthday month to the equation and you have your 7 month Initial enrollment period.
For example, let’s say your birthday month is April. You would add the 3 months prior, which is January, February, and March (3). Then add the 3 months following your birthday month; May, June and July (3). So now we have 3 + 3, and add your birthday month of April (1) to get 3+3+1 equals 7 months total. Your Initial Enrollment Period (IEP) is 7 months surrounding your birthday month.
Initial Enrollment Period
- 3 Months Before the Month You Turn 65
- 1 The Month Your Turn 65
- 3 Months After the Month You Turn 65
Why would I delay Original Medicare Enrollment?
Are you about to embark on the Medicare enrollment journey? You might be thinking “I can’t miss the Medicare Enrollment Period“. If your worried about missing the initial enrollment period, then most likely you should be. This is not to scare you, but a reminder that missing the enrollment deadline can have negative financial consequences.
So what happens if you miss the enrollment deadline? Maybe nothing. Especially, if you have group health insurance coverage through your employer or spouses employer. In fact, you may want to delay your Medicare Part B enrollment and continue employer based group insurance.
Why delay Medicare Part B? Medicare Part B requires a monthly premium, while Part A is typically premium free with 40 quarters or 10 years of paid Medicare taxes. A future Special Election Period (avoiding the penalty) is available to individuals that decide to maintain their employer insurance. You typically will not owe a late enrollment penalty if your qualify for a Special Election Period (SEP).
A Special Election Period is separate from the Initial Enrollment Period and is typically for individuals that are working with a group health insurance plan. An 8 month SEP is available beginning a month after your employment ends or your group health plan based on current employment ends. See Part A & Part B sign up periods
Medicare Late Enrollment Penalties
Enrollment penalties maybe as high as 10% per 12 month period without coverage. If you do not have a SEP and you enroll 24 months after the end of your IEP then you may be subject to a 20% premium penalty (10% per 12 months). This means your premiums will be 20% higher than the typical Medicare premium owed if delay enrollment by 2 years or 10% over a 1 year, 12 month period.
Original Medicare Enrollment Periods
• Initial Enrollment Period (IEP) – Your seven month period that begins 3 months BEFORE your birthday month and ends 3 months AFTER your birthday month.
• General Enrollment Period (GEP) – January 1st through March 31st of each year. Individuals may enroll during GEP if they missed or delayed their Original Medicare sign up. A late enrollment penalty maybe assessed. If you are in a situation where you enroll in Part B during the GEP, you may also enroll in a Medicare Advantage plan during GEP as well.
• Special Enrollment Period (SEP) – A Special Election Period is allowed outside of IEP and GEP medicare enrollment period. Typically most individuals utilize SEP after coverage from a Union or Employer Sponsored health insurance plan coverage ends or after employment ends (whichever scenario occurs first). Volunteers that are serving in another country may qualify for SEP as well.