Updated October 2017
Do you have questions about what it takes to be eligible for Medicare? In this article, we’ll outline the Medicare eligibility requirements so that you can enroll in the Medicare program, which is overseen by the Centers for Medicare & Medicaid Services (CMS) via Medicare.gov. We’ll also provide detailed information on some of the things you can do to prevent your enrollment process from being delayed or unnecessarily complicated.
Who is eligible to receive Medicare benefits?
Medicare was designed to ensure that eligible disabled persons and seniors age 65 and older would have accessible, quality health care, regardless of income. To receive Medicare benefits, you have to be a U.S. citizen or a legal resident of at least five continuous years, and you must be entitled to receive Social Security benefits.
As a general rule, all U.S. citizens aged 65 or older are eligible for Medicare Part A and Part B. These two parts form original Medicare, and age is definitely the most common qualifying factor when enrolling in the program. Created in 1965, Medicare is a government-backed healthcare insurance plan for senior citizens. It’s also designed for people who might be under 65 but who have certain disabilities, such as end-stage renal disease (ESRD) or Lou Gehrig’s disease.
You don’t have to be retired to enroll in Medicare Part A. This portion of Medicare, which covers hospital stays and related care, is available if you’re over the age of 65, even if you’re still working. If you’re receiving Social Security benefits or benefits from the Railroad Retirement Board, then you don’t have to pay a premium for Part A. Likewise, people who have already paid into the system through work don’t usually pay premiums for Part A.
When should you enroll for Medicare?
If you’re nearing age 65, then your initial eligibility period will start three months before the month you turn 65, run through that birthday month and end three months after your birthday month. It’s a 7-month period known as the initial enrollment period (IEP). Your IEP lets you sign up for Medicare Part A (which is typically free for most people) and Part B (which you must pay a monthly premium for). The earlier you sign up, the better. There are late enrollment fees for people who wait, especially when it comes to Part B premiums.
There are other incentives to early enrollment. If you apply during the three-month period prior to your 65th birthday, your Medicare coverage will start the same month you turn 65. If you wait until your birthday month to enroll, your coverage will begin the month after your 65th birthday. Waiting until the final three months of the enrollment period may result in a delay of coverage for up to three months.
During your IEP, you can also sign up for extra coverage through a private insurance company. Medigap Supplemental Insurance helps fill in the gaps left by traditional Medicare (Parts A and B). If you need this extra coverage, sign up during your initial enrollment window. It’s the only time that you’re guaranteed a plan. The Medigap enrollment window actually starts the month that you turn 65 and runs for six months after that. You have to be enrolled in Medicare Part B to sign up for Medigap insurance.
By law, you’re allowed to sign up for any Medigap policy in your state as long as you enroll during the initial window, even if you have medical issues that would otherwise prevent you from getting covered. An insurer has to charge you the same premium rate as a healthy person, too, so enrolling during this initial period is essential if you need the extra coverage. Your guarantees under the initial enrollment window expire once that 6-month eligibility period ends. Outside of the initial eligibility window, you may not find Medigap coverage at all. And if you do, it will probably cost a lot more.
People with end-stage renal disease are eligible for Medicare.
People of any age suffering from end-stage renal disease (ESRD) may be eligible for Medicare. Among these potential beneficiaries are:
- Those undergoing dialysis
- Those with permanent kidney failure
- Those on a kidney transplant list or awaiting to be put on the transplant list
- Those who have already had a kidney transplant
Under these conditions, enrollment in Medicare Parts A and B may be done by contacting your local Social Security Administration (SSA) office. This will ensure that your dialysis services or kidney transplant services are covered under Medicare. If you now have ESRD and you’re paying higher premiums for Part B because you didn’t sign up when you were first eligible, you can re-enroll in Part B to lower your monthly premiums.
If you have ESRD, you can sign up for Medicare.
Medicare Part B is the portion of Medicare covering medical insurance. It helps pay for doctor’s bills, outpatient hospital procedures and care, and other medically necessary services. It is not free. While the majority of people typically do not have to pay a monthly premium for their Medicare Part A plan, the same is not true for the Medicare Part B portion of your Medicare coverage. You will have to pay a premium for your Medicare Part B plan.
Signing up for Medicare Part B is optional, but you need to know that waiting to enroll could cost you more. When you sign up for Part B during your initial eligibility window, you’ll only pay the premium required of you. If you don’t enroll during the IEP but later decide to sign up, you’ll pay the premium plus a late enrollment penalty. That penalty is 10 percent for every 12-month period that you could have had Part B but chose not to, and it lasts for as long as you have Part B coverage.
Save money by signing up for Part B when you can.
Medicare Part B covers non-hospital medical services, like outpatient treatments, visits to your doctor and other routine care. Unlike Part A, Medicare Part B isn’t free. There’s a monthly premium for medical coverage. Most people who enroll in Part B – which, like all portions of Medicare, is completely optional – pay a standard premium rate that’s set by the government. In 2017, the standard premium for new enrollees is $134 a month. Higher-income beneficiaries pay more. Next year, the standard premium rate is expected to jump to $149 a month.
In 2018, premium rates are expected to rise for most Part B beneficiaries. This year and last, about 70 percent of Part B enrollees were protected from higher premium rates thanks to the hold harmless provision of the Social Security Act, which says that Part B premiums can’t exceed the cost of living adjustment (COLA) in Social Security payments. Since there wasn’t a COLA in 2016 and a slight one in 2017, most Part B enrollees paid well below the standard 2017 Part premium.
For next year, Social Security is expected to offer a more generous COLA of 2.2 percent, which will mean an increase in Part B premiums for everyone who was held harmless the last two years. Official rates have yet to be released for 2018.
It’s important to note that signing up for Part B when you first become eligible can save you money over time. That’s because you’ll pay a late enrollment fee if you wait to sign up outside of your initial eligibility window. The fee is 10 percent on top of your premium for every 12-month period that you could have had Part B but didn’t. The fee is permanent, too. You’ll pay the late enrollment fee for as long as you have Part B.
Enroll in Medicare based on a disability (and before 65).
Medicare eligibility typically depends on age, but some people get Parts A and B without meeting the age requirements. If you have certain disabilities and are under age 65, then you may get enrolled in original Medicare automatically. You have to be receiving Social Security disability benefits or Railroad Retirement Board disability benefits for 24 consecutive months in order to qualify for automatic enrollment.
Once you start receiving disability benefits, the Social Security Administration automatically enrolls you in Medicare Part A and Part B on your 25th month of disability. However, because there is a monthly premium charge for Medicare Part B, you do have the option to drop Part B coverage when you receive your card in the mail. There will be instructions for doing so when you get enrolled.
Early retirement and Medicare
You can retire at any age, but Medicare won’t cover your healthcare until you reach age 65. Early retirement does not qualify you for early enrollment into Medicare. If you retire at age 62, then you’ll need to find another source of health insurance until you meet Medicare’s eligibility requirements. Check with your employer to see how this will impact your coverage. You may be able to keep your current insurance through COBRA or some other means. Research your options well in advance to make sure you get the coverage that you need.