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You can only sign up for Medicare during certain times so it’s important to understand Medicare enrollment periods and deadlines. The General Enrollment Period (GEP) is the time period every year from January 1 to March 31 when seniors can enroll in the various parts of Medicare for the first time if they missed their Initial Enrollment Period (IEP) and do not qualify for a Special Enrollment Period (SEP).
What to Know about Medicare’s General Enrollment Period
If you miss your Initial Enrollment Period (IEP), which is the seven-month window around your 65th birthday (or 25th disability check), then you can enroll in Medicare during the General Enrollment Period (GEP). Starting in 2023, coverage kicks in the month after you sign up during the GEP but you may still be assigned a late-enrollment penalty.
Which parts of Medicare are subject to late enrollment penalties?
The three parts of Medicare that are subject to late enrollment penalties are:
1. Part A (hospital insurance) IF you do not qualify for premium-free Part A
2. Part B (medical insurance)
3. Part D (prescription drug coverage)
Premium Part A:
If you have to buy Part A (because you don’t qualify for premium-free Part A), and you don't buy it when you're first eligible for Medicare during your Initial Enrollment Period, you can sign up for Part A during the General Enrollment Period. Your monthly premium may go up 10% for twice the number of years you didn't sign up so the Part A penalty may still be applied if you sign up during the GEP depending on how long you wait to enroll after you were first eligible.
Medicare Part B:
If you do not enroll in Medicare Part B during your Initial Enrollment Period and you do not have creditable coverage*, you can use the General Enrollment Period to sign up. Typically, kupuna can avoid the Part B penalty as long as they sign up for Medicare Part B within 12 months of the end of their IEP. For example, if your Initial Enrollment Period ends on October 31 and you wait until the next General Enrollment Period to enroll in Part B between January 1 and March 31, you may avoid a penalty because less than 12 months passed between the end of your IEP and when you enrolled in Part B. If you are outside of the 12-month grace period, you will likely have to pay an extra 10% for each year you could have signed up for Part B, but didn’t.
*Creditable coverage is a health insurance or health benefit plan that meets a minimum set of qualifications. Many group and individual health plans, student health plans, and government-provided plans count as creditable coverage.
Medicare Part D:
If you do not enroll in Medicare Part D (or a Medicare Advantage plan that covers prescription drugs) during your Initial Enrollment Period even though you do not have creditable drug coverage**, you can use the General Enrollment Period to sign up. A person on Medicare who is not enrolled in Medicare Part D or other creditable prescription drug coverage for any period of 63 consecutive days or more after the end of their Initial Enrollment Period may be at risk for the Part D late-enrollment penalty.
The Part D penalty is calculated by multiplying 1% of the “national base beneficiary premium” ($32.74 in 2023) by the number of full, uncovered months the person did not have Part D or creditable coverage. Then, the monthly premium is rounded to the nearest 10 cents. Part D penalties remain for the entire time someone has Part D coverage.
**Creditable prescription drug coverage is prescription drug coverage that typically pays at least as much as Medicare’s standard prescription drug coverage. Examples are plans from an employer, union, Indian Health Service, or the Department of Veterans Affairs.
Our independent insurance agents are dedicated to assisting people on Medicare and those who are ready to transition from employer coverage to personal retirement coverage. We help kupuna understand their benefits options and apply for additional coverage, as needed. We are the only insurance agency in Hawaii contracted with EVERY Medicare Advantage plan, which means we are able to offer unbiased advice; all at no cost to our clients.
At PBC, our clients are our number one priority and we look forward to getting to know you and your needs. Call us today at (808) 738-4500 to see how we may be of assistance.