Alyssa Lane
If you already have health insurance through your job, you can sign up for Medicare at any time while you're still working and covered by your group health plan. You can also sign up within 8 months of losing your group health plan coverage, even if you continue to work. Typically, your Medicare coverage begins the month after you sign up. However, if you miss your 7-month Initial Enrollment Period, you may have to pay a monthly late enrollment penalty. If you have End-Stage Renal Disease (ESRD), you can get Medicare coverage earlier. It's important to understand the rules, which vary depending on the type of health insurance you currently have.
| Characteristics | Values |
|---|---|
| When does Medicare coverage start? | Coverage always starts on the first of the month. |
| When to sign up for Medicare? | During your Initial Enrollment Period (IEP) which is a 7-month period starting 3 months before you turn 65 and ending 3 months after you turn 65. |
| What if you miss the IEP? | You may have to pay a monthly late enrollment penalty for as long as you have Part B coverage. |
| What if you have health insurance through your job? | You can sign up anytime while working and still covered by the group health plan. |
| What if you lose your health insurance? | You have an 8-month Special Enrollment Period (SEP) to sign up for Medicare. |
| What if you have End-Stage Renal Disease (ESRD)? | You may be eligible to get Medicare earlier. |
| What is Medicare Part A? | Hospital Insurance. Most people get it for free, but some have to pay a premium. |
| What is Medicare Part B? | Medical Insurance. |
| What is Medicare Part C? | Medicare Advantage Plans, a private insurance option that covers hospital and medical costs. |
| What is Medicare Part D? | Prescription medications. |
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What You'll Learn
Medicare Part A and Part B
Most people sign up for both Part A and Part B when they become eligible, which is usually when they turn 65. If you already have Part A, you can add Part B during specific enrollment periods. There is an 8-month Special Enrollment Period (SEP) when you can sign up for Part B or add it to existing Part A coverage. This period begins when you stop working or lose your health insurance, whichever comes first. If you miss this 8-month window, you will have to wait to sign up and may have to pay a monthly late enrollment penalty until you turn 65. This penalty increases the longer you wait.
If you have Medicare due to a disability or ALS (Lou Gehrig's disease), you will automatically have Part A coverage. If you are still working when you turn 65, you may be able to wait to sign up for Part B without incurring a late enrollment penalty. If you have retiree coverage from a previous job, it may not pay for your health services unless you have both Part A and Part B.
The start date of your coverage depends on the month you sign up. For Part A, if your 65th birthday is on the first of the month, your coverage starts the month before. Otherwise, it starts on your birthday. For Part B, coverage generally begins the first day of the month after you sign up.
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Initial Enrollment Period
The Initial Enrollment Period (IEP) for Medicare is a seven-month period that typically begins three months before a person turns 65, includes their birthday month, and ends three months after they turn 65. For example, if your birthday is on December 1, your IEP starts on September 1 and ends on March 31.
During the IEP, individuals can sign up for Medicare Part A (hospital insurance) and Part B (medical insurance). Most people are eligible for premium-free Part A, but some have to pay a premium for this coverage. To be eligible for premium-free Part A, an individual must meet specific criteria based on their work history, Social Security or Railroad Retirement Board (RRB) benefits, or their spouse or parent's work history and benefits.
If you miss your IEP, you may have to pay a monthly late enrollment penalty for Part B and premium Part A coverage. This penalty increases the longer you wait to sign up. Additionally, if you have employer-provided health insurance, you may choose to delay enrolling in Medicare Part B until you or your spouse stop working or the group health plan ends.
After your IEP ends, you can sign up for Part B and premium Part A during the General Enrollment Period, which occurs annually from January 1 to March 31. Coverage during this period starts the month after you sign up. It is important to note that there may be life-long penalties if you sign up during the General Enrollment Period.
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Special Enrollment Period
If you miss the Initial Enrollment Period, you may have to wait to sign up and pay a monthly late enrollment penalty for as long as you have Part B coverage. The penalty increases the longer you wait. The date your coverage starts depend on which month you sign up during your Initial Enrollment Period. Coverage always starts on the first of the month.
A Special Enrollment Period is available for a limited time. If you don't sign up during your Special Enrollment Period, you'll have to wait for the next General Enrollment Period and you might have to pay a monthly late enrollment penalty. You can make changes to your Medicare Advantage and Medicare drug coverage when certain events happen in your life, like if you move or lose other coverage. These chances to make changes are called Special Enrollment Periods. The types of changes you can make and the timing depend on your life event.
You can also choose to go back to Original Medicare if you’re in a Medicare Advantage Plan and you move outside your plan’s service area. If you move outside your old plan’s service area and don’t join a new Medicare Advantage Plan during this Special Enrollment Period, you’ll be enrolled in Original Medicare when you’re dropped from your old Medicare Advantage Plan. Your chance to switch begins when you move and continues for 2 full months after you move. If you tell your plan before you move, your chance to switch plans begins the month before the month you move and continues for 2 full months after you move.
There are other situations where you might qualify for a special enrollment period, like if you joined a plan based on misleading or incorrect information from a plan representative or State Health Insurance Assistance Program, or you’re notified that there’s a significant change in your plan’s provider network. These special enrollment periods are evaluated on a case-by-case basis.
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Late enrollment penalties
Medicare Part A
Most people are automatically eligible for premium-free Medicare Part A (hospital insurance) if they or their spouse worked and paid Medicare taxes for at least 10 years. However, if you didn't work enough hours to qualify for premium-free Part A, you can purchase it during your Initial Enrollment Period (IEP). The IEP for Part A is a seven-month window that starts three months before you turn 65, includes your birthday month, and ends three months after you turn 65. If you don't purchase Part A during this period, you will incur a late enrollment penalty when you eventually sign up. The penalty is 10% of the monthly premium for twice the number of years you were eligible but didn't sign up. For example, if you wait one year after being eligible, you'll pay the penalty for two years.
Medicare Part B
Medicare Part B (medical insurance) is typically something people sign up for when they are first eligible, i.e., at age 65. However, if an individual already has coverage through an employer group health plan, they may choose to delay enrolling in Part B. If you decide not to enroll in Part B during your IEP and don't qualify for a Special Enrollment Period (SEP), you will incur a late enrollment penalty. The penalty is an extra 10% for each year you could have signed up but didn't, added to the standard Part B monthly premium. This penalty generally needs to be paid for as long as you have Part B coverage.
Medicare Part D
Medicare Part D is a prescription drug plan. Individuals can enroll in Part D without incurring a late enrollment penalty during the three months that begin when their Medicare Parts A and B become active. If this window is missed, a late enrollment penalty will be added to the monthly premium. The fee is calculated as 1% of the average monthly prescription premium cost, multiplied by the number of months the enrollee was late.
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Medicare Advantage Plans
To be eligible for a Medicare Advantage Plan, you need to have both Parts A and B. Most people get Part A for free, but some have to pay a premium. To be eligible for premium-free Part A, an individual must meet certain requirements, such as having worked a specified number of quarters under Social Security or the Railroad Retirement Board (RRB), or being the spouse or dependent child of someone who has. Individuals receiving regular dialysis treatments or a kidney transplant may also be eligible for premium-free Part A.
If you have to pay a premium for Part A, you must file an application to enroll by contacting the Social Security Administration. Additionally, you must also enroll in or already have Part B.
If you are already covered through an employer group health plan, you can delay enrolling in Medicare Parts A and B until after your coverage ends. You can sign up at any time while you are still covered by the group health plan, within eight months of losing your coverage, or within eight months of the group health plan ending while you are still working.
It is important to note that joining a Medicare Advantage Plan may cause you to lose your employer or union coverage, which could also affect the coverage of your spouse and dependents.
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Frequently asked questions
You can sign up for Medicare at any time while you're still working and covered by your employer's group health plan. You can also sign up within 8 months of losing your group health plan coverage, even if you continue to work.
Your Medicare coverage will typically begin the month after you sign up. In some cases, it may start sooner or up to three months later, depending on your circumstances.
Yes, if you miss your 7-month Initial Enrollment Period, you may have to pay a monthly late enrollment penalty for as long as you have Part B coverage. The penalty increases the longer you wait.
Yes, but you will have to pay full price for your Marketplace plan. Additionally, your insurance company might decide to end your Marketplace coverage.
