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Medicare Enrollment Periods Equal Total Confusion

As an Insurance Agent that specializes in Medicare one of the most confusing aspects of Medicare are their Enrollment periods.  They have a half dozen or more names for different enrollment terms.  Each of these terms all mean something different.  So if you thought you were going crazy you really are not. We will do our best to break down each of these terms and what they mean.

  1. Initial Enrollment Period (“IEP”)
  2. General Enrollment Period (“GEP”)
  3. Medicare Advantage Special Enrollment Period (“SEP”)
  4. Medicare Special Enrollment Period (“SEP”)
  5. Medicare Advantage & Part D Annual Enrollment Period (“AEP”)
  6. Medicare Supplement Open Enrollment Period

 

We will do our best to clearly explain each of these Medicare Enrollment Periods and what they mean for you good or bad.

What is the Medicare Initial Enrollment Period?

When you’re first eligible for Medicare, you have a 7-month Initial Enrollment Period to sign up for Part A and/or Part B.

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
  • Ends 3 months after the month you turn 65

For example, if you turn 65 on April 12th, your Medicare IEP would run from January 1st to July 31st.

One exception to this rule: if your birthday falls on the 1st of the month – your Initial Enrollment Period (IEP) will start one month early. For example, if your birthday is April 1st, your IEP will begin December 1st and your Medicare will begin one month early on March 1st.

During the IEP, you can enroll in Original Medicare (Part A and/or Part B).  Once you are enrolled into both parts of Original Medicare you also have the option to enroll into a Medicare Supplement Plan or a Medicare Advantage plan (Medicare Part C). Enrolling during your IEP avoids any late enrollment penalty.

It is important that you also enroll into your Medicare Part D by enrolling into a prescription drug coverage during this same window. That drug coverage can be a standalone plan or part of a Medicare Advantage plan that includes Part D.

If you enroll in Original Medicare, you may want additional coverage with a Medicare Supplement Plan (Medigap). For this, you will use your Medicare Supplement Open Enrollment Period. This is a 6-month window starting on your Medicare Part B effective date.

Some major advantages to using the Medigap OEP to enroll in a Medigap are:

  • You can’t be turned down for any Medigap plan available in your area regardless of your health status.
  • Your insurance company cannot charge you higher premiums because of your health status or pre-existing conditions.
  • Your coverage for any pre-existing conditions cannot be delayed
Medicare Part C Eligibility

What happens if I miss my Medicare Initial Enrollment Period ("IEP")?

You finished the race toward retirement but in all the excitement you forgot to enroll into Medicare.  Now What!  

If you don’t have creditable coverage like an employers plan here is what will happen as a result of forgetting to sign up for Medicare on time.

Medicare Part A – Penalties

If you don’t qualify for premium-free Part A coverage as a result of not having enough work credits, and you don’t buy it during your IEP, you’ll pay a 10% premium penalty for twice the number of years you could have bought the coverage but didn’t.

Medicare Part B – Penalties

If you forget to enroll into Part B during your IEP, you’ll more than likely be responsible to pay a late enrollment penalty.  The penalty equals 10% of the annual premium for every 12-month period you should have had Part B but didn’t enroll. This penalty will remain in place forever.  

You may also go without Part B coverage for a significant amount of time, you’ll have to wait until the next General Enrollment Period, or GEP. This means your coverage won’t start until July 1 of that year or the following year.

Medicare Part D – Penalties

If you don’t have creditable Part D prescription drug coverage and miss your IEP, you’ll pay a penalty with your Part D premium—again, as long as you have the coverage. The penalty is 1% per consecutive month that you went without coverage for prescription drugs. The national base premium is currently about $35 per month, so if you go without coverage for a year, you’ll pay an extra $4.20 a month (and quite possibly more if the Part D base premium increases) for as long as you have coverage.

What if I miss my Medicare Enrollment Period

When is the Medicare General Enrollment Period?

If you missed your Initial Enrollment Period and you don’t qualify for a special enrollment period, you can sign up for Original Medicare during the General Enrollment Period (GEP). This runs from January 1 through March 31 each year.

Please keep in mind, that even though you can enroll into Original Medicare during this time as a backup, you are still subject to the late enrollment penalties mentioned above.

In addition, I am for some folks the only reason they are now signing up for coverage is because they need to see a Doctor or need to have some kind of surgery.  The problem you will face is, your coverage won’t begin until July 1, which means you may go without coverage for months.

Keep in mind that the General Enrollment Period only applies to Original Medicare. If you want a Medicare Advantage plan or Medicare Part D coverage for prescription drugs, you’ll have to wait for the Annual Enrollment Period.

When can I get Medicare Advantage or Medicare Part D if I miss my IEP?

There’s an Annual Enrollment Period, or AEP, that occurs between October 15 and December 7 each year that’s specifically for Medicare Part C and Part D, the Medicare Advantage plans and prescription drug plans. If you miss your initial Medicare enrollment period, you can use the next Annual Enrollment Period to join a plan.

During the AEP, you can switch to Medicare Advantage from Original Medicare. You can also change Medicare Advantage plans if you’re currently enrolled in one. Should you join a Medicare Advantage plan and later want to leave it, you can use the AEP to return to Original Medicare as well.

You can also enroll in a Medicare Part D Prescription Drug Plan—or switch to a different plan if you’re currently enrolled. You can even drop your Part D coverage completely, without penalty, if you’ve obtained creditable coverage through an employer or other source.

The Medicare Advantage Open Enrollment Period

Medicare program also gives you a window of opportunity to change your mind about a Medicare Advantage plan. If you enroll in a Medicare Advantage plan and for any reason you don’t like it, you can disenroll during the new Medicare Open Enrollment Period from January 1 – March 31.

During this time you can:

  • Return to Original Medicare and elect a Part D drug plan to go alongside it
  • Or Switch to a different Medicare Advantage plans once that better meets your needs

 

It is important to mention, if you return to Original Medicare you are no longer within your Initial Enrollment Period, the Medicare Supplemental Plan aka: Medigap plan, is no longer issued on a guaranteed basis. In many circumstances you may have to answer health questions for the Medigap plan, and the carrier no longer has to accept you.  Please ensure you call us prior to making this change so we can go over your medical history.

What is a Medicare Special Enrollment Period?

There are certain situations that will trigger a Special Enrollment Period (SEP) that is specific to you.  

Medicare special enrollment period is a two-month window where you are able to make changes to your coverage due to a special circumstance. For example, moving outside the insurance plan’s service area will qualify you for a Special Enrollment period.  Another example is the Medicare Advantage Insurance Carrier is no longer offering coverage in your service area.

As a result of these qualified events, you are able to use the SEP to switch to a new Medicare Advantage or Part D prescription drug plan. Likewise, you can also return to Original Medicare without penalty. In some circumstances you can also enroll into a Medigap plan under guaranteed issue rights—with no medical underwriting.

There are also other situations in which you may be eligible for a Special Enrollment Period. If you don’t see your situation above, get in touch with us to learn what your options are.

The Medigap Open Enrollment Period

We mentioned above that once you are enrolled into Original Medicare Parts A and B, you will also qualify for a 6-month open enrollment window for Medicare Supplement aka: Medigap plans.

The 6 month window begins with your Part B effective date shown on your Medicare card and is a one-time election period. You can enroll in any Medigap plan that you like, with no health questions asked.

What’s most important to know about this enrollment period is that it happens only once for most people. Then it’s gone forever so it’s one of the Medicare enrollment periods that you cannot miss.

Get Help with your Medicare Choices

I hope you have a better understanding of your all the different Medicare Enrollment Periods. 

We want to help you navigate the process and make sure you receive the Medicare Benefits you are entitled too. 

As you just learned if you miss an important date, and you could pay the consequences for the rest of your life.

We want to make sure you don’t miss any deadlines? Reach out to one of our Medicare Insurance Agents today! We’ll help you with the enrollment process so that you can avoid any Medicare late penalties.