• Tim Lofton

Medicare enrollment made ... easier ...

Timothy P. Lofton, Managing Partner - Cornerstone Consulting Group | CEO - The Retirement Blueprint™ | Author | Speaker

Published on September 4, 2018

Enrolling in Medicare for the first time, or changing your status, can feel like a torturous process. It does not have to be if you have a basic knowledge of the options and limitations. Since the “Annual Election Period” begins on October 15 and ends on December 7, we summarized the basic choices and when/how to make them. We will not deal extensively with the premiums, penalties or co-pays.

There are 2 main Medicare coverage plans: 

Original Medicare and a Medicare Advantage Plan (Part C) 

Original Medicare consists of Part A, Part B and Part D for drug coverage. A Medicare Advantage Plan consists of all three parts. Essentially, it is a less expensive form of Medicare, but medical care is through a Health Maintenance Organization (HMO), which restricts your choice of doctors and is only valid in the region in which it is issued.

There are certain periods when you can join, change or drop the different parts of Medicare (A, B, C and D). In other words, you are not allowed to enroll or withdraw whenever you want.

Initial Enrollment Period (aka Open Enrollment Period)

When you're first eligible for Medicare, you have a 7-month Initial Enrollment Period (IEP) to sign up for Part A and/or Part B and Part D, or a Medicare Advantage Plan. If you're eligible for Medicare when you turn 65, you can sign up during the 7-month period that begins 3 months before the month you turn 65, includes the month you turn 65, and ends 3 months after the month you turn 65. The eligibility is determined primarily by the years you have paid into the Medicare system while working. Most people generally qualify for free Part A and Part B enrollment. There are other premiums associated with Part A, Part B, and Part D, and to a far lesser degree, for Part C. When you sign up during the IEP, which you are required to do, you avoid any late enrollment penalties and higher premiums. There are, of course, exceptions.

General Enrollment Period (GEP) - January 1 to March 31 of Each Year

People who did not enroll in Part A or Part B during their IEP, or who terminated their Part A or Part B benefits, and want to re-enroll, may enroll in either or both parts during the General Enrollment Period, which is January 1 to March 31 of each year. If you enroll during the GEP, your benefits will begin July 1. If you enroll in Part B during the GEP, you may have to pay the Part B late enrollment penalty mentioned above. 

Annual Election Period (AEP) - October 15 to December 7 of Each Year

During this time frame, people can join, change or drop a Medicare Advantage Plan or Part D plan.

For example:

  • If you did not enroll in a Medicare Advantage Plan during your IEP or a Part D plan during your IEP, you may enroll in a Medicare Advantage plan or Part D plan during the AEP.

  • If you are already in a Medicare Advantage Plan or Part D plan, you may change insurance companies or disenrollment from your Plan during the AEP.

  • If you had a Medicare Advantage Plan, went back to Original Medicare, and now want to be in a Medicare Advantage Plan again, you may enroll during the AEP. You may make more than one election during the AEP. Your final election during that period is the one that counts. The last election (or only election) made during the AEP will be effective January 1 of the following year.

Special Enrollment Period (SEP)

A Special Enrollment Period exists for Part B and Medicare Advantage Plans, as well as for Part D plans in certain circumstances. For Part B, an SEP is available only for people who delay enrollment in Part B because they have employer group coverage. If you become eligible for Medicare at 65 and have coverage from an employer group health plan based on your or your spouse’s employment, you may delay enrollment in Part B. When you stop working or your employer group health coverage ends, you have an SEP to enroll in Part B. The SEP is 8 months following the end of employment or employer group health coverage, whichever comes first. If you enroll during the SEP, you do not owe the late enrollment penalty for Part B. Special Election Periods (SEPs) for Medicare Advantage and Part D plans may be available depending on the situation:

  • If you move, you may change to a different plan not offered in the area where you formerly lived.

  • If your coverage through your employer or union group health plan ends, you have an SEP to enroll in a Medicare Advantage or Part D plan. The SEP ends 2 months after the month your coverage through the group plan ends.

  • If you are eligible for full Medicaid benefits, you have an ongoing SEP to enroll in or change Medicare Advantage or Part D plans.

  • If you lose your full Medicaid benefits, you have a 3-month SEP to change Medicare Advantage or Part D plans, starting the month you are notified of the loss of Medicaid eligibility.

  • If you enroll in Part B during the GEP (but are not entitled to premium-free Part A), you have an SEP to enroll in a Part D plan between April 1 and June 30. If you enroll in a Part D plan during this SEP, your plan becomes effective July 1.

  • If you enroll in a Medicare Advantage plan during the IEP around your 65th birthday, you have an SEP to disenroll from the Medicare Advantage plan during your first 12 months in the plan and return to Original Medicare.

All of the information provided here comes from the Medicare.gov website.

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