Enrolling in Medicare should be at the top of the to-do list if you’re about to turn 65.
When people start collecting Social Security at age 65, they are automatically enrolled in Medicare. However, when people choose to delay their collection of Social Security benefits beyond age 65 to maximize their earnings in retirement, they have to manually sign up for Medicare.
Some people mistakenly believe that Medicare includes coverage of things like dental, vision and prescription drugs, but it only provides medical and hospital insurance.
“As a result, some people experience a coverage gap in which they must go months without coverage outside of medical and hospital before they are given another opportunity to enroll in a private plan that offers that coverage,” says Christian Worstell, a licensed health insurance agent with MedicareAdvantage.com in Raleigh, North Carolina.
Another misconception about Medicare is that it’s free. Uncle Sam charges premiums based on how much you contributed to Medicare while you were employed. Medicare Part A, which covers hospital insurance, charges no premium if you or your spouse paid Medicare taxes when you worked. Medicare Part B (medical insurance) charges a standard premium amount of $164.90 a month, which increases for higher income earners under an income related monthly adjustment amount, also referred to as IRMAA. Premiums are deducted directly from Social Security checks or people pay the government directly when they are not receiving Social Security.
“Every year, Social Security will evaluate your income and determine if your premium should increase or decrease based on your earnings,” says Erin Nevins, president of USA Medicare Consultants, a division of EP Nevins Insurance Agency Inc., of Greenville, New York. “Some individuals with higher incomes must pay an additional premium for Medicare Part B and Part D.”
[See: Things You Should Know About Medicare]
Simple Steps to Prepare for Enrollment
It’s important to enroll in Medicare
during the appropriate enrollment periods to avoid gaps in coverage and potential penalties. Follow these eight steps to simplify your Medicare enrollment process.
[Read: Your Guide to Medicare Coverage.]
1. Learn about your eligibility
Medicare is available to older Americans, but there are special circumstances where younger individuals may also qualify. Specific eligibility requirements include:
— Age 65 and older.
— Younger individuals with disabilities, including those with end-stage renal disease or ALS (amyotrophic lateral sclerosis).
— U.S. citizen or legal permanent resident who has lived in the United States for at least five continuous years.
2. Understand Medicare
When you enroll in Medicare, you need to become familiar with the different parts of the program. Medicare is divided into four parts:
— Part A (hospital insurance): Helps cover inpatient care in hospitals and skilled nursing facilities (not custodial or long-term care).
— Part B (medical insurance): Helps cover medically necessary doctors’ services, outpatient care, home health services, durable medical equipment, mental health services and other medical services.
— Part C (Medicare Advantage plans): Includes benefits and services covered under Part A and Part B, plus prescription drug coverage and additional benefits, such as vision, dental and hearing (not hearing aids).
— Part D (prescription drug coverage): Helps cover the cost of prescription drugs.
3. Collect documents
To enroll in Medicare, you will need to provide specific documents to the government to prove that you qualify. These documents include your Social Security number, proof of age (such as a driver’s license or unexpired passport), proof of legal residency and information about your current health insurance.
4. Know your enrollment period
There’s an initial enrollment window, which is a seven-month period that typically starts three months before your 65th birthday and goes through your birthday month and three months after your birthday month.
5. Apply for Medicare
Enroll online through the Social Security Administration’s website, call them at 800-772-1213 or visit a local Social Security office in person. The Social Security website has a “Find an Office” tool that will help you locate the nearest office.
6. Sign up for Medicare Advantage (Part C), Medigap or Part D
When you sign up for Medicare Part A and B, you should also consider enrolling in a Medicare Advantage (Part C), Medigap and/or Prescription (Part D) plan that is offered through private health insurers. Compare prescription drug plans online by using the Medicare Plan Finder tool.
7. Await confirmation
A few weeks after submitting your application, you should receive a red, white and blue Medicare card in the mail that will include your name and Medicare number. Protect and keep this card safe to ensure no one steals your Medicare number.
8. Assess your Medicare plan annually, as benefits may change in Medicare Advantage or Part D plans
Assess your Medicare plan annually, as benefits may change. Open enrollment season is typically from October 15 to December 7, which allows you to select changes to your plan, as necessary.
[READ: Medicare vs. Medicaid: What Is the Difference?]
Common Questions About Medicare Enrollment
Medicare can be confusing, and there’s never a shortage of questions when it comes to enrollment. The Social Security Administration receives hundreds of thousands of questions each year. Here are several common questions about Medicare:
Retirement
Question: Do you have to be retired to sign up for Medicare? Answer: No, Medicare works with employer-provided insurance and you can have private insurance and Medicare coverage at the same time.
Automatic enrollment
Question: Does Medicare automatically enroll everyone into the program? Answer: If you have started collecting Social Security benefits, you will be automatically enrolled in Medicare when you turn 65. If you have chosen to delay Social Security, you will have to manually sign up for Medicare online, over the phone or at your local Social Security office.
Late penalties
Question: Are there penalties for late enrollment? Answer: Medicare Part A has a 10% late enrollment penalty that remains in effect for twice the number of years that you were eligible to sign up for coverage but did not. However, most people qualify for premium-free Part A and do not pay this penalty. Medicare Part B has a late enrollment penalty equal to 10% of the monthly premium for each year that you were eligible to enroll but did not. This penalty remains in effect for as long as you remain enrolled in Part B. Medicare Part D has a late enrollment penalty of 1% for each month you went without a Part D plan or other drug coverage.
Covered expenses
Question: Does Medicare cover all medical, dental, vision and surgical expenses? Answer: Medicare does not cover certain services or treatments, such as long-term care, dental care, vision care, hearing aids and cosmetic procedures. It’s important to understand what is and isn’t covered by your specific Medicare plan so ask questions about coverage.
Medicare Advantage enrollment
Question: Is it mandatory to be enrolled in Medicare to sign up for a private Medicare plan such as Medicare Advantage, Medicare Part D or Medigap? Answer: Yes, you must remain enrolled in Medicare (Part A and B) to maintain coverage in a private Medicare plan.
Access to providers
Question: Do all doctors and health care providers accept Medicare? Answer: Medicare allows you to choose any health care provider who accepts Medicare, but some doctors may not participate in Medicare, which means they can charge more than the Medicare-approved amount. Additionally, certain Medicare Advantage plans have networks of preferred providers, and if you go out of network, you may have higher out-of-pocket costs.
Out-of-pocket costs
Question: Will I pay any out-of-pocket costs under Medicare? Answer: While Medicare covers a significant portion of medical costs, there are still out-of-pocket expenses such as deductibles, coinsurance and copayments. These costs can add up, especially if you require frequent medical services or hospital stays.
Need further help
Question: Where do I go for more information about signing up for Medicare? Answer: Work with a licensed insurance agent, independent insurance advisor or a representative from your local State Health Insurance Assistance Program (SHIP) chapter. There’s a lot to know about Medicare and it can be both confusing and intimidating to navigate, especially for newly eligible beneficiaries. Making matters worse is that one enrollment mistake or missed deadline can lead to monetary penalties. It does not cost you anything to consult with an insurance agent, SHIP representative or even with someone from the Social Security office, so take advantage of the free help that is available.
More from U.S. News
Options to Consider Besides Nursing Homes
How Assisted Living Can Improve Quality of Life
What to Pack in Your Hospital Bag: A Checklist
How Do You Apply for Medicare? originally appeared on usnews.com
