Not so long ago, you needed to remember the date of your wedding anniversary, your kids’ birthdays and maybe a few other special milestones. But if you are a Baby Boomer on the verge of retirement (or if you’ve already taken the plunge), you have to keep Medicare enrollment deadlines firmly in mind. Because if you don’t take advantage of these windows of opportunity, you take the risk of facing health insurance coverage gaps or having to pay more—sometimes much more—for your coverage.
For starters, you’ll have to decide: original Medicare or Medicare Advantage? There are pros and cons to both. It boils down to what works best for your personal situation. Keep in mind that if you opt for basic Medicare, you may want to add a Medicare Supplement Insurance (also referred to as Medigap) policy to cover some of the costs not covered by Medicare.
And don’t forget prescription drug coverage! You can enroll in a separate Medicare prescription drug plan (Part D) or opt to have Rx coverage added to your Medicare Advantage plan. If you’re a veteran retired from military service, there’s good news: you’ll have access to TRICARE for life, but you must still sign up for Medicare parts A and B to get that benefit.
So whether you are looking toward retirement, evaluating your current coverage or looking to make a change, it’s a good idea to review the deadlines and enrollment periods associated with Medicare.
Generally, if you’re receiving Social Security or Railroad Retirement Board benefits, on the first day of the month you turn 65 you’ll be automatically enrolled in Medicare parts A and B.
If you aren’t automatically brought on board, you can sign up during the seven-month window that begins three months before the month you turn 65. The window closes at the end of the month three months after the month you turn 65. If you miss this sign-up and are not eligible for a special enrollment period, you will pay the price in the form of higher premiums for the rest of your life. You don’t want to miss this one.
If your coverage through an employer ends, you generally have an eight-month period to sign up for Medicare without a premium penalty. Other events can also trigger a special enrollment period. For example, you could move out of an area covered by your Medicare Advantage plan, participate in a plan that is sanctioned or terminated by Medicare or return to the United States from a foreign country. Check Medicare.gov for the details on your specific situation.
If you missed your initial signup and weren’t eligible for a special enrollment period, you can sign up for Medicare during the General Enrollment Period. Your coverage becomes effective July 1. Again, you must pay a permanent 10 percent premium penalty for each full 12-month period you waited to sign up.
You don’t need to sign up annually, but during this period you can change prescription drug plans and change or sign up for a Medicare Advantage plan. All changes are effective Jan. 1.
If you choose to use Original Medicare and supplement the coverage with Medicare Supplement Insurance, there’s yet another enrollment period. This one begins when you turn 65 and enroll in Medicare Part B, and it lasts an additional five months.
Note: there is no underwriting during this open enrollment period. Although Medicare Supplement policies offer services in accordance with plan names, prices can vary, so it could pay to shop around.
Each year, you have an opportunity to leave your Medicare Advantage plan by switching back to Original Medicare and signing up for a stand-alone prescription drug plan. If you make this move, you may also want to consider a Medicare Supplement policy.
Benjamin Franklin said there were only two things certain in life: death and taxes
Source: The American Legion Magazine, “Windows of Opportunity,” July 2015