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Late Medicare enrollment

Medicare can be confusing; understanding the rules and guidelines for enrollment is important to ensure you have access to the healthcare coverage you need. Although many people are aware of the initial enrollment period, there are situations when individuals may apply for late Medicare enrollment.  We will go over some reasons for late enrollment, the rules surrounding late enrollment, and how to apply for Medicare.

Reasons for Late Medicare Enrollment

Missing your IEP (Initial Enrollment Period) – If you neglected to sign up for Medicare during your IEP, which begins three months before your 65th birthday and extends to three months after, you may need to wait for the GEP to sign up.

Missed a SEP (Special Enrollment Period) – In some cases, a qualifying event such as loss of employer coverage or moving can trigger an SEP.  If you miss this opportunity, you may have to wait for the GEP.

You have employer Coverage after the age of 65 – If either you or your spouse continue to work past the age of 65 and have employer-sponsored health coverage, you may delay Medicare enrollment. Late enrollment is allowed without a penalty as long as you enroll in Medicare within eight months of losing the employer coverage.

Rules and Guidelines for late Medicare enrollment

General Enrollment Period (GEP) – The GEP runs from January 1 through March 31 each year. Those who enroll during this period may face a late enrollment penalty (LEP).  The LEP is added to your Medicare Part A, if you do not qualify for premium free Part A, and Part B monthly premium amount.   For each 12-month period you delay enrollment in Part B, there is a 10% penalty applied.  The penalty lasts for as long as the beneficiary has Part B coverage. That is one reason to enroll in Medicare as soon as you are eligible.

Learn more about the Part B LEP

Medicare Advantage with prescription coverage (MAPD) and stand-alone Part D plans – Individuals who did not have creditable prescription coverage while they were eligible, will also have to pay a Part D penalty for late enrollment.

How to apply for Medicare

Go to the Official Medicare Website – In some instances, beneficiaries can enroll in Medicare online.  This is the easiest way to enroll.  Just visit medicare.gov and you will see options to enroll.  This website provides comprehensive information for those enrolling in Medicare or if you have Medicare questions.

Visit your local Social Security Office – Beneficiaries can either apply for Medicare over the phone by calling 1-800-772-1213 Monday – Friday 8 am – 7 pm.  Tell the representative if you want to apply for Medicare A & B or Part A only.  Hearing impaired beneficiaries can call TTY 1-800-325-0778.

If you want to apply in person, click here to find a local social security office.

Once you have your Medicare coverage in place, it is important to get the help of a licensed Medicare agent who can guide you through the different coverage choices available to supplement your coverage.

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What is the Medicare Part B penalty

The Medicare Part B penalty is often the result of someone who is eligible for Medicare not understanding the rules.   Those who fail to follow them can end up paying the penalties for life.  Read the information below to understand who needs to enroll in Medicare Part B and when.  We will also review the valid waivers that would allow someone who is eligible for Medicare to waive Part B without a penalty when they enroll in the future.

To see how to calculate your Part B enrollment penalty click here

Eligibility for Medicare A and B

Many people sign up for both Medicare Part A (hospital Ins.) and Part B (medical Ins.) when they turn 65 and are first eligible.   There are some possible problems that can occur if you sign up later.  Although, in some instances it makes sense to wait to sign up until later.

Because most people do not pay a premium for Part A, this makes it a no brainer to sign up for Part A when you are first eligible for Medicare even if you are still working.

If you choose to sign up for Part B, you will need to pay a premium.  For this reason, some people will wait to sign up for Part B.

• Generally, you won’t have to pay a Part B penalty if you qualify for a Special Enrollment Period. Learn more about Special Enrollment Periods.
• You’ll pay an extra 10% for each year you could have signed up for Part B, but didn’t.
• You may also pay a higher premium depending on your income, this is called an IRMAA, watch our YouTube video to understand what a IRMAA is.

More information about  signing up for Part B:

• • Your 8-month Special Enrollment Period to sign up for Part B starts when you stop working, even if you choose
    COBRA or other non-Medicare coverage
  • If you lose your job-based health coverage before you or your spouse stop working, you have 8 months to sign up.
  • If you want Medicare coverage to start when your job-based health insurance ends, you need to sign up for Part B the month before you or your spouse plan to retire. Your coverage will start the month after Social Security (or the Railroad Retirement Board) gets your completed forms. You’ll need to fill out an extra form showing you had job-based health coverage while you or your spouse were working.
  • If you want more coverage, you have a limited time to get it.

• If you miss the 8-month special enrollment period, you will have to wait to sign up and go without Medical coverage.  That is a dangerous gamble to take.  The penalty you will pay will also continue to grow.

If you miss your initial enrollment in Medicare Part B have two possible election options:

The first is a Part B special election period and the second is the Medicare Part B general election period.

CLICK HERE TO LEARN MORE ABOUT THE MEDICARE GEP

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Medicare Part D Enrollment Penalty

How much is the Part D penalty?

The cost of the Medicare part D enrollment penalty depends on how long you go without Medicare Part D or creditable prescription drug coverage.

How do I know if there will be a Medicare part D enrollment penalty?

After you join a Medicare drug plan, the plan will tell you if you owe a penalty and what your premium will be. Most people will have to pay this penalty for as long as you have a Medicare drug plan. The exceptions would be for those that drop coverage or are approved for a drug help program such as MSP.

What if I don’t agree that I have a penalty?

You may be able to ask for a “reconsideration.” Your drug plan will send you a letter explaining how to appeal.  All appeals will be sent to a company called Maximus that will review appeals.  Maximus is the only company that can review them. As a result, you will need to wait until they make a decision. You must do this within 60 days from the date on the letter telling you that you owe a late enrollment penalty. Also send any documentation that supports your case.

Do I have to pay the penalty even if I think it is wrong?

You must pay the penalty until a decision has been made on the appeal. Failure to pay the penalty could result in termination of your enrollment.

How long does it take to decide on the appeal?

In general, Maximus (Medicare contractor) has 90 days to make a decision.

What happens if Maximus decides the penalty is wrong?

If Maximus decides you should not have a penalty, they will send you a letter stating that fact.   Your drug plan will then stop charging you the penalty and will send details regarding a refund of the penalty amount you already paid.

What happens if Maximus decides the penalty is correct?

They will send you a letter stating the penalty is correct. You will be forced to continue paying the penalty if you want to maintain you drug coverage.

Do you have a Medicare supplement plan (also called Medigap)?  If so, a high deductible plan F supplement may be a way to save money compared to your current supplement plan. CLICK TO LEARN ABOUT HIGH DEDUCTIBLE F PLAN SUPPLEMENTS

 Medicare Part B Late Enrollment Penalty

Individuals who are eligible and choose not to enroll in Medicare Part B will receive a Late Enrollment Penalty.   Medicare will assess this penalty for those people that do not enroll when first eligible.  Medicare Part B provides coverage for outpatient services.  These services include doctors visits, testing, scans, outpatient surgeries as well as anything else medical done outside of the hospital. Enrollment in Part B for most people is automatic when they turn 65. Individuals usually pay $104.90 a month for part B benefits.  This amount can vary according to your income.

There is a penalty for not enrolling in part B when first eligible to do so.  The current penalty is 10% of the premium for every year that you choose not to elect Part B coverage.   You need to have Medicare A and B in order to purchase a Medicare supplement or Medicare Advantage plan.  What if you have coverage through your employer?  For those age 65 and over actively working and being provided with coverage from an employer it may not make sense to buy part B. Read more