According to the Centers for Medicare & Medicaid Services, 76.5 million people in the United States were enrolled in Medicare in 2020.
Medicare aims to provide health insurance to older or disabled Americans. If you think you may be eligible, it’s important to know about common Medicare enrollment mistakes.
Keep reading to learn about the seven most common mistakes people make when enrolling in Medicare.
1) Not Knowing About Common Medicare Enrollment Mistakes
This might seem obvious, but if you fail to do any research before enrolling in Medicare, you won’t be aware of the most common mistakes people make.
You can learn a lot just from the Medicare.gov website. For starters, some individuals have to sign up for Medicare, while others are signed up automatically when they turn 65 and are already receiving Social Security benefits.
During your first year of Medicare, your doctor can provide you with a “Welcome to Medicare” preventative list that will review your medical and social history, and help you determine what services you may be eligible for.
2) Assuming You Don’t Qualify Because of Your Age or Employment Status
You do not have to reach full retirement age to be eligible for Medicare. In fact, the full retirement age for most people is between 66 and 67. Medicare allows you to sign up at age 65, which means you don’t need to be collecting Social Security benefits to enroll.
You may also be worried you haven’t worked long enough to qualify for Medicare. As long as you’ve worked for ten years, you won’t have to pay premiums for Part A coverage.
It’s also important to remember that you don’t need any work credits to qualify for Part B or Part D. As long as you are 65 or older and a legal U.S. citizen or resident who has lived in the United States for at least five years, you can qualify to pay the monthly premium.
3) Assuming You Can’t Afford Medicare
Even if you have limited income, there are still ways you can get Medicare. The government offers several programs to those who need assistance.
Medicare Savings Programs (MSPs) can pay for a portion of the monthly Part B premium and some cost-sharing depending on the program.
There is also a federal program called Extra Help. This helps pay for some of the costs associated with Part D prescription coverage.
Finally, some states offer State Pharmaceutical Assitance Programs (SPAPs). These programs help eligible individuals pay for prescriptions.
4) Ignoring the Open Enrollment Period
You have a seven-month window to sign up for Medicare. That enrollment period starts three months prior to your 65th birthday, includes your birthday months, and extends three months further.
As mentioned, some people are automatically signed up. If you are not, you have to apply online for Part A and Part B.
If you ignore the Medicare enrollment period, you could have to wait until the general enrollment period or even face penalties, which we’ll discuss in more detail later.
5) Ignoring Late Enrollment Penalties
If you fail to enroll in Medicare on time, you could face penalties. The penalties depend on the policy you’re planning to enroll in.
- Part A Late Enrollment Penalty. If you have to buy Part A because you don’t qualify for premium-free and miss the enrollment period, your monthly period could go up 10 percent for twice the number of years you didn’t sign up.
- Part B Late Enrollment Penalty. The Part B penalty can increase your premium by 10 percent for each 12-month period you were eligible for, and the penalty will last as long as you have Medicare.
- Part D Late Enrollment Penalty. While Part D is voluntary, you could face a penalty if you sign up after your first eligible, which is calculated by multiplying one percent of the national base beneficiary time the number of full months you went without coverage.
6) Not Understanding Out-of-Pocket Costs
The cost of Medicare varies from person to person. Some assume the coverage is completely free, but this is rarely the case.
The plan you choose will have different costs based on its premium, deductible, copayment, and coinsurance. The premium is what you’ll pay per month. The higher the premium, the lower your deducible, copayment, and coinsurance tend to be.
The deductible is the total amount you need to pay before Medicare starts paying its share. The copayment is the fixed amount you pay for specific services, like doctor’s appointments. Finally, co-insurance is the percentage of the cost of a service you are required to pay, which is typically around 20%.
Once you have a better understanding of the out-of-pocket costs, you’ll be able to pick the plan that’s right for you.
7) Choosing a Plan That Doesn’t Cover Your Doctors or Prescriptions
With the number of available Medicare plan options, it’s important to verify coverage is included in the plan you choose for your doctors and prescriptions.
You can typically go to any doctor, hospital, or medical facility that accepts Medicare patients with original Medicare. However, if you opt for the Medicare Advantage plan, you’ll need to choose from one of three different network types: Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), Private Fee-For-Service (PFFS).
Before you pick a plan, you want to verify your doctor accepts Medicare and confirm that you won’t have to pay more if you have a condition that requires specialized care.
Learn More About Medicare
Now that you know how to avoid Medicare enrollment mistakes, you’ll be better prepared when it comes time to enroll for your benefits.
Our South Florida Medicare specialists are here if you need help with enrollment or have questions about potential benefits. In addition, we provide education and information on Medicare Supplement Insurance plans, Medicare Advantage Plans, and Medicare Part D Prescription Plans.
Contact us today to learn more.