The Medicare Enrollment Mistake That Could Follow You for Life

Signing up for Medicare might seem pretty straightforward. Since coverage typically kicks in at age 65, you might assume you should plan to enroll on your 65th birthday and call it a day.

In reality, the rules of Medicare enrollment are a bit more complex. And not understanding them thoroughly could leave you paying more for Medicare for life.

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Why Medicare timing matters

Even though Medicare coverage generally begins at 65, you can sign up sooner than that. Your initial enrollment windows begins three months before the month you turn 65 and ends three months after that month. So all told, you have seven months to put your Medicare coverage in place.

If you sign up for Medicare in the three months after your 65th birthday, your coverage itself should date back to your 65th birthday. So it's generally not a problem to enroll after turning 65 as long as you're within that initial seven-month window.

What could become problematic, though, is delaying your Medicare enrollment past that seven-month window.

The reason? If you fail to sign up for Medicare Part B on time and don't qualify for a special enrollment period, your monthly premiums could increase by 10% for every 12-month period you were eligible for coverage but didn't enroll.

Similarly, going too long without creditable prescription drug coverage could result in surcharges on your Part D premiums. So it's important to pay close attention to when you're supposed to sign up.

How special enrollment periods work

Signing up for Medicare outside of your initial seven-month window could leave you paying more for life -- unless you qualify for a special enrollment period. In that case, you can enroll at a later point without risking the aforementioned penalties.

But to qualify for a special enrollment period, you need to be covered by a qualifying group health plan at the time of your initial enrollment window. That usually means being on a plan with 20 or more employees.

If you're planning to delay Medicare because you're still working during your seven-month initial enrollment period, make sure you qualify for a special enrollment period. You can generally confirm that your current health plan is eligible with your benefits administrator.

A decision you don't want to get wrong

Medicare can be expensive enough without having to pay more for your Part B and Part D premiums. The good news is that you can avoid penalties by signing up for Medicare on time. It's that simple.

It's also important to understand Medicare's enrollment rules. Another mistake some seniors risk making, for example, is thinking they have to be getting Social Security to enroll in Medicare. That's not the case. So the more you educate yourself, the more likely you may be to avoid a costly error.

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