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Medicare Part B on a desk.

Do I Have to Apply for Medicare Part B?

If you are approaching 65, you may wonder how to enroll in Medicare. Is it like signing up for the types of health insurance you’ve had for years, either through work or private payer insurance? Or does it happen automatically?  The short answer is yes…and no. 

Medicare can be confusing because some parts of it do happen automatically, under certain circumstances. But don’t worry, this article will briefly explain what Medicare B is, if and when you need to enroll in it, and what penalties you may face if you opt out. 

What is Medicare Part B?

Put simply, Medicare Part B is your medical insurance. It covers everything that happens outside of a hospital. This includes outpatient services, preventative care, lab tests, and specific home health medical equipment. However, it does not cover dental, vision, or hearing care. Nor does it cover prescription medications. If you are wondering if you may need more coverage than what Original Medicare provides, check out this article with four reasons why Original Medicare may not be enough for you.

Medicare Part B has a monthly premium and a yearly deductible. In 2023 the minimum monthly premium is $164.90/ month. The deductible is $226 before Medicare Part B starts to pay. After you have paid your deductible, you will usually need to cover 20% of the cost for each approved service. There is no cap on out-of-pocket expenses. 

When Do I Need to Enroll in Medicare Part B?

medicare part B - Happy senior couple celebrating birthday together.

Here is where Medicare can get confusing. You know Medicare eligibility begins when you turn 65. But are you automatically enrolled? What if you want to keep working? Do you have to sign up at 65? Every situation is different, so the following information is a general guideline. Schedule an appointment for personalized recommendations based on your circumstances.

Medicare Before 65

Most people will begin Medicare when they turn 65. However, if you started receiving disability benefits before age 65, you would have been enrolled in Medicare Part A immediately and received Part B 24 months later. If this is your situation, read more about Medicare for the Disabled here.

Medicare At 65

If you are not already getting Social Security benefits, you must enroll in Medicare. The Initial Enrollment Period lasts seven months. Three months before your 65th birthday, you are eligible to enroll. Your enrollment period ends three months after your birth month. For example, if your birthday is May 25th, your Initial Enrollment Period will run from February 1st through August 1st

If you want Medicare coverage immediately upon turning 65, you will need to enroll in Medicare during the first three months of your enrollment period. If you sign up during that time, your Medicare coverage will begin on the first of your birthday month. If you enroll after the first, your coverage will start on the first of the following month. 

What if you want to continue working? Do you still need to enroll in Medicare? It depends on the size of your employer group health plan. If you work for a small company (meaning fewer than 20 employees), you will need to enroll in Medicare. However, if you work for a large company with more than 20 employees, you can continue to use your employer coverage.

Medicare After 65

So, you’ve worked for a few more years and are now ready to retire. Is it too late to enroll in Medicare? Fortunately, the answer is no, so long as you have had a creditable health insurance plan through your employer. 

Once you retire, you will no longer have your employer-provided health insurance. You will need Medicare coverage at that time. In this situation, the date your employer coverage ends, instead of your birth month, will determine your Initial Enrollment Period. You will still have the same seven-month enrollment period, from three months before your employer coverage ends until three months after your coverage ends. 

It is strongly recommended that you enroll during the three months before you retire. Doing so ensures that your Medicare coverage begins immediately after your employer coverage ends. Failure to do so could leave you unprotected should a medical situation arise. 

How Can I Avoid Penalties?

penalty highlighted on a dictionary

For many, the most stressful part of signing up for Medicare is the fear of penalties. One mistake can have lifelong consequences. When it comes to enrolling in Medicare Part B, one penalty to avoid is the Late Enrollment Penalty. 

Life can get busy, and it is easy to miss important deadlines. The end of your enrollment period is not a deadline you can afford to miss. When you enroll in Medicare Part B outside the enrollment window, you will be charged a 10% penalty on top of your Part B cost. This penalty charge, which could be roughly $17 per month, will be added to your monthly premium every month you have Medicare Part B coverage. This adds up to an expensive and avoidable lifetime cost. 

As you approach the age of 65, be sure to understand when your enrollment period begins and ends. Mark these dates on your calendar or set a notification on your smartphone or computer. If you continue to work past 65, make sure you know if your employer’s health insurance is considered creditable coverage. It is recommended that you sign up for Medicare Part B during the first three months of your enrollment period to ensure that you avoid penalties and prevent gaps in your coverage. 

To learn what other penalties you need to avoid, click here.

Making Sense of Medicare Part B

Enrolling in Medicare Part B is a vital part of preparing for your retirement. It may sometimes feel overwhelming, but you don’t need to navigate the process alone. The Medicare Family is ready to assist you. We have over 40 years of experience understanding the Medicare enrollment process, which we want to share with you. Download the Medicare and Social Security Cheat Sheet, which will help you keep the important details of Medicare enrollment close at hand.

Sylvia Gordon, aka Medicare Mama®, is an expert on all things Medicare and Social Security. She is the 2nd Generation here at The Medicare Family and has served on the advisory boards of major insurance companies like UnitedHealthcare®, Cigna, and Anthem. In her free time, she can be found taking care of her animals (dogs, goats, peacocks, chickens), and reading a good book. Learn More.
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