Medicare Enrollment Considerations

If you are nearing age 65, it is likely time for you to start thinking about Medicare. Medicare can be complicated, especially for high-net-worth individuals. The goal of this piece is to get you thinking about what medical insurance will look like for you in retirement well in advance of must-make decisions.

When do I enroll in Medicare?

  • Generally, around your 65th birthday. This is called your “Initial Enrollment Period.” The initial enrollment period lasts for seven (7) months; it begins three (3) months before you turn 65 and ends three (3) months after the month you turn 65.
  • Avoid the penalty! If you miss your initial enrollment period, you may be subject to a lifetime monthly late enrollment penalty fee. The penalty amount increases the longer you wait to initiate enrollment. 

Where do I enroll in Medicare?

  • Visit the Social Security Administration’s website:
  • Call Social Security Administration: 1-800-772-1213. 
  • Contact your local social security office

What kind of coverage do I need?

The kind of medical coverage you will need in retirement will depend on your needs and working situation. Some coverage choices to consider are:

  • Original Medicare includes Medicare Part A (Hospital Insurance) and Part B (Medical Insurance).   Think Part A as “inpatient” and Part B as “outpatient”
  • Medicare Part D (Prescription Drug Insurance)
  • To help cover out-of-pocket costs in Original Medicare, you can purchase supplemental coverage known as Medigap.

To avoid penalty with Original Medicare, everyone is required to enroll in Part A during the initial enrollment period regardless of your employment status. You can delay enrolling in Part B if you or your spouse are still employed by a company with more than 20 employees and are covered by their health insurance program.

  • You can no longer contribute to an HSA after the first day of the month you turn 65 years old. 
  • COBRA coverage does not allow you to delay Part B or D coverage without penalty. 

Once you lose employer health insurance, the timeline for enrolling in additional Medicare programs varies. To avoid a gap in coverage, you should enroll one (1) month before your employer coverage ends. The timelines for enrollment without penalty after losing employer coverage are as follows: 

  • Medicare Part B – eight (8) months
  • Medicare Part D – two (2) months
  • Medigap Coverage – six (6) months

If you can’t delay Part B coverage, you must enroll in Part A and Part B during your initial enrollment period. If you wish to enroll in Medicare Part D, you must do so during this time as well. Many Medigap plans require Part D coverage.

Do I need Medigap coverage? 

For many retirees, medical bills become one of the biggest expenses in retirement. A Fidelity Investments study showed that the average couple in retirement faces approximately $315,000 in medical expenses. When deciding to get Medigap coverage, consider the following details.

  • Medicare does not cover all health care expenses in retirement. 
  • Medigap can help eliminate many Medicare out-of-pocket costs, extend skilled nursing home and hospital coverage, and cover limited health care costs when traveling abroad.
  • You can generally keep your doctors under Medigap.

If you are nearing age 65 or have questions regarding Medicare, feel free to reach out.  Our team understands choosing the right coverage can be confusing.  We’re happy to help guide your through the decision-making process.


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