Medicare Open Enrollment

Medicare is the health insurance program for adults 65 and older. Once you hit 65, you enjoy a seven-month period (three months before and after your birth month) when you can sign up for Medicare. The good news is that you don’t have to settle on one plan for the rest of your life. If you’re dissatisfied with the Medicare plan you choose, a window opens where you can make changes to your coverage each year. This window is what is called Medicare enrollment and runs from October 15 through December 7. During this time, you can join, switch, or drop a plan. Moreover, even if you’re happy with the plan you’re currently on, you might want to confirm whether it’s the best fitting plan for next year.

The Medicare Late Enrollment Penalty

Three months before you celebrate your 65th birthday, you’ll receive information in the mail about your Medicare Initial Enrollment Period (IEP). And as earlier said, you have a 7-month window to enroll in the program or risk penalties that last your whole life. So, if you don’t have another form of creditable health coverage past your 65th birthday, you may be looking at some penalties. For example, in Part A of Medicare, you’ll pay a 10% premium increase penalty that lasts twice the number of years you went without coverage. So, if you went without coverage for two after your 65th birthday, you’d have to pay the penalty plus your regular premium for four years.

COBRA and Medicare

The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that requires employers to offer health care continuation to covered employees, their spouses, and their dependents after a qualifying event. For the most part, COBRA works best for people who have recently left their job. The COBRA law stipulates that you’re able to stay with your former employer’s health plan for 18 to 36 months even if you’re no longer employed. Furthermore, most people with Medicare use COBRA to supplement their coverage and help pay for more services. In some special situations, people who use COBRA and Medicare together can save some money. However, if you turn 65 and become eligible for Medicare while still on COBRA, your COBRA coverage will end. 

Resources (PDF downloads):
The Medicare Reference Guide
10 Common Medicare Questions Answered

Listen now to learn – How to get ready for Medicare open enrollment.