Knowing when to enroll in Medicare Part B, the part of Medicare that covers surgeries, outpatient medical care, therapies, medical equipment and doctor visits, just to name a few services, is very important. Oftentimes beneficiaries are unaware as to when to enroll, leading to much confusion, and that can end up being costly. You see, if you do not get enrolled in Part B when you are first eligible, or when you lose Creditable Coverage, you may get stuck with a hefty lifetime penalty.
When Should You Enroll?
The time period in which you can enroll in Medicare Part B is called your Initial Enrollment Period (IEP). This is a seven month enrollment period that begins 3 months before the month you turn 65, includes the month you turn 65, and runs through the 3 months immediately following your birth month. For example, if your birthday is in July, your IEP would begin in April and would end in the month of October. If you are collecting Social Security before age 65, or if you are Medicare eligible due to a disability you will be automatically enrolled in Medicare Part B.
When Will You Receive a Late Enrollment Penalty?
Those who do not enroll in Medicare Part B when they are first eligible, and do not qualify for a Special Enrollment Period, may be subjected to a late enrollment penalty.
This could mean paying a 10% higher monthly premium for every 12 month period that a beneficiary was eligible for for Part B but did not enroll.
This higher Part B premium will have to be paid for as long as you have Medicare. Let’s say you wait 4 years to sign up for Part B after you were first eligible, your penalty could be 40% of the premium. Meaning, that for as long as you have Part B you will pay the monthly premium plus 40%. If you enroll in Part B (or are automatically enrolled) you could still face a penalty if you decide to drop Part B and sign up again at a later date.
Special Enrollment Period
A Special Enrollment Period (SEP), means you have a qualifying circumstance which allows you to enroll in Part B after our IEP has passed. One example would be IF you have health coverage based on you or your spouse’s current employment, you can delay Part B. If you were to lose Creditable Coverage through your employer you would then have an 8 month SEP in which to sign up for Medicare Part B. It must be noted that certain types of coverage do not count as Creditable Coverage based on current employment and would not make you exempt from paying the Part B penalty if you delay enrollment.