Most people become eligible for Medicare when they turn 65. If you’re covered by an employer plan at that time, and your workplace has more than 20 employees, you can keep that coverage. But if you work for a small employer or will not have private health insurance when you turn 65, you will need to sign up for Medicare if you wish to have health insurance.
This also is the case if you’ve been covered by the Affordable Care Act or if you’ve left your job and have been getting temporary health coverage through COBRA. In most cases, these plans stop providing primary coverage when you turn 65. If you’re not sure whether you might be an exception, ask your insurer before you turn 65.
In late 2020, Congress passed a bill called the Beneficiary Enrollment Notification and Eligibility Simplification Act, more mercifully known just as the BENES Act. It addresses some big enrollment headaches described below.
Medicare’s initial enrollment period is seven months long. It begins three months before you turn 65, continues through your birthday month and ends three months later. Failing to sign up during this period triggers late-enrollment penalties that last a lifetime.
But the more serious penalty is not having coverage if a person encounters a meaningful health care need. Here is where the BENES Act will help a lot.
Under BENES, Medicare coverage will start the first day of the month after people enroll any time during month 4, 5, 6, or 7.
Another source of nightmares involves people who failed, for whatever reason, to get Medicare during their initial enrollment period. Medicare has long offered a general enrollment period during the first quarter of the year in which such people can sign up. However, there has often been a long lag until people were actually covered.
Those lags are gone. Coverage during general enrollment will take effect the first day of the month after a person enrolls.
Special enrollment periods (SEP) are available for people who turn 65 but do not enroll because they’re still covered by a group health plan. This period is eight months. Depending on which date occurs first, your SEP begins either the month after your employment ends or whenever your group coverage ends.