If you are turning 65 soon, you probably know you need to sign up for Medicare. But you may have a lot of questions about when to sign up and what to sign up for. Here’s what you need to know about your Medicare coverage options and your enrollment timelines.
When to Sign Up
Most people become eligible for Medicare when they turn 65. If you are already collecting Social Security, you will automatically be enrolled in Medicare Parts A and B. You will receive your Medicare benefits card in the mail about three months before your coverage starts, which is the 1st of the month that you turn 65.
If you are not already collecting Social Security, you will need to enroll in Part A and Part B during your Initial Enrollment Period (IEP), the seven month window that starts three months before your birthday month, and ends three months after. It’s important to sign up during your IEP to avoid late enrollment penalties.
You can enroll in Part A and B through Social Security either over the phone at 1-800-772-1213 Monday through Friday 7am-7pm, online at SocialSecurity.gov or in person at your local Social Security office.
If You Are Still Working When You Turn 65
If you are working past 65, whether you can delay enrolling in Medicare depends on the size of your employer. If you have health insurance through an employer (your employer or your spouse’s) with fewer than 20 employees, Medicare is considered your primary insurance when you turn 65 so you need to sign up during your IEP to avoid late penalties.
If you have health insurance through an employer with 20 or more employees, you can delay enrolling in Medicare until you (or your spouse) retire or leave that employer-based coverage. If you qualify for premium free Part A, it makes sense to sign up for this when you turn 65 even if you continue to work.
Part A and Part B Premiums
Premiums for Part A and B are adjusted annually. You could pay more if you enrolled late.
The Part A premium is free if you or your spouse have worked at least 10 years. If you don’t qualify for premium free Part A, what you pay is based on how long you or your spouse worked. In 2024, if you worked at least 30 quarters you will pay $278 per month. If you worked less than 30 quarters, you will pay $505 per month.
The Part B premium is based on your income. The standard monthly premium in 2024 is $174.70. Individuals with higher incomes could pay more.
Original Medicare Does Not Cover Everything
Medicare Parts A and B, known as Original Medicare, do not cover everything and have additional out-of-pocket costs. Part A has an annual deductible and coinsurance if you are admitted to the hospital. Part B has an annual deductible and covers 80% of your doctor visits, outpatient care, and medical supplies, leaving you responsible for the other 20%. There is no annual out-of-pocket maximum. Original Medicare offers no prescription drug coverage.
You have two options for filling these gaps in coverage:
- Medicare Advantage Plans – These plans, also known as Part C, are offered by private insurance carriers and are an alternative to Original Medicare. They cover everything covered by Original Medicare and usually include Part D prescription coverage, all for one monthly premium. Premiums vary based on the plan type and the insurer. Most services require a copay or coinsurance. There is annual out-of-pocket maximum capping how much you have to spend each year. Medicare Advantage (MA) plans require you to use the doctors and hospitals in their network. Some plans offer out-of-network coverage for a higher out-of-pocket cost. Most MA plans include supplemental benefits such as vision, dental, and hearing which are not covered by Original Medicare.
- Medicare Supplement Plans – Also known as Medigap plans, these plans work in conjunction with Original Medicare to help cover what is not covered by Parts A and B. There are 10 different plan options, each offering a different level of coverage. Not all plans are available in every state. Medigap plans are offered through private insurance carriers and monthly premiums will vary based on the insurer, which plan you choose, your zip code, and other factors such as your gender and whether you are a smoker.Your Medigap open enrollment begins when you sign up for Part B and lasts for six months. During this time, you have Guaranteed Issue Rights, meaning you can’t be denied coverage. If you miss this enrollment timeline you will have to answer a medical questionnaire. Depending on your answers you could be charged a higher rate or denied coverage altogether.
If you opt for Original Medicare, you will need to enroll in a stand-alone Part D plan for your prescription drug coverage. These are offered by private insurers and monthly premiums vary. You should enroll during your IEP to avoid late enrollment penalties.
Healthcare Educators Can Help
If your Medicare choices seem overwhelming, the experienced team at Healthcare Educators is here to guide you through every step of the process. We will take the time to review your personal circumstances and educate you on your options. If you have limited income and resources, we can see if you qualify for a Medicare Saving Program to help with your out-of-pocket costs. Contact us today.