When to Sign Up for Medicare

The federal government sends “welcome to Medicare” packets only to people who are already receiving Social Security benefits. If you’re not among them, you’re on your own in deciding how and when to sign up. And the stakes are high: Big coverage gaps and potential lifetime penalties could result from missing key deadlines.

You’re eligible for Medicare at age 65, even though the age for full Social Security benefits is now 66 and rising. If you have been receiving early Social Security benefits, then you’re automatically enrolled in Medicare when you turn 65 and will receive your Medicare card three months before your birthday. Otherwise, you’ll have to enroll in Medicare yourself.

At this point, you’ll need to decide whether to sign up for one or both parts of Medicare. Medicare Part A covers hospitalization and is premium-free if you or your spouse paid Medicare taxes for at least 10 years. Part B covers outpatient care, such as doctors’ visits, x-rays and tests, and costs most people $104.90 per month in 2015.

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If neither you nor your spouse has health insurance through a current employer, then sign up for both Medicare Part A and Part B. The word current is key. You’ll also need to sign up for Medicare if you left your job and continued your employer’s coverage through COBRA, the federal law that lets former employees keep group coverage for up to 18 months.

You can sign up without penalty at any time from three months before until three months after your 65th birthday. Go to www.socialsecurity.gov to enroll in Medicare, even if you aren’t signing up for Social Security yet. If you miss the deadline, you’ll be able to get Part B coverage only at limited times (January through March, with coverage starting July 1), and you may have to pay a lifetime late-enrollment penalty of 10% over your regular Part B premium for every year you delayed enrolling in Part B. See www.medicare.gov for details.

You’ll also generally have to sign up for Medicare if you are retired and receiving retiree health benefits. Your retiree coverage can fill in gaps in Medicare, but your Medicare policy must pay first if you’re 65 or older. (Federal retiree coverage is an exception; it will remain your primary coverage if you don’t sign up for Medicare. But you will pay a penalty if you decide to sign up for Medicare Part B later.)

Coordinate with work coverage. For people who are still working for companies with fewer than 20 employees, employee coverage generally becomes secondary to Medicare at age 65, and you should sign up for parts A and B. Some employers negotiate with insurers to keep their coverage primary for employees who are 65 and older. Ask your employer (and get it in writing) before delaying Medicare.

If you or your spouse has coverage through a current employer with 20 or more employees, then you don’t have to sign up for Medicare while you’re still working. Because Part A is generally premium-free, however, you have no reason not to enroll at age 65 (unless you want to contribute to a health savings account). If you’re happy with your employee coverage and don’t want to get Part B but are receiving Social Security benefits and automatically received a Medicare card, you can send it back and ask for it to be reissued just for Part A. (You can’t delay signing up for Part A if you are already on Social Security.)

When you do retire, you must sign up for Medicare Part B within eight months of leaving your job. You won’t be able to sign up online because you’ll need to provide evidence that you’ve had coverage through work since age 65. Visit your local Social Security office or call 800-772-1213.

See Our Slide Show: 11 Common Medicare Mistakes