For most Americans, one perk of turning age 65 is the opportunity to enroll in Medicare. This federal health insurance program pays for inpatient and outpatient care and often prescription drugs.
Seniors have several choices when it comes to how they receive their Medicare benefits, and fortunately, they aren’t locked into one plan for their entire retirement. Instead, the government offers multiple enrollment periods for older Americans to weigh their options and make changes to their coverage.
Keep reading to learn more about Medicare plans and the various enrollment periods that are available for signing up for or switching coverage.
The 2 main types of Medicare
Medicare beneficiaries have two main choices when it comes to receiving their benefits:
- Original Medicare: Also known as traditional Medicare, this coverage comes directly from the government and is split into two parts. Part A is hospital insurance while Part B pays for outpatient care. Almost everyone pays a standard premium amount for Original Medicare.
- Medicare Advantage: Medicare Advantage plans, also known as Part C, are offered by private health insurance companies. These plans must include everything covered by Original Medicare, but they may also include additional perks such as vision or dental benefits. Premiums for Medicare Advantage plans can vary.
Add-on Medicare plans
Seniors who opt for Original Medicare can add on either or both of the following types of plans:
- Part D: Original Medicare does not include prescription drug coverage so retirees need to select a Part D plan to pay for their medications. These plans are offered by private health insurance companies, and the premiums vary. Seniors who choose Medicare Advantage will almost always have prescription drug coverage rolled into their plan so a separate Part D policy is not needed.
- Medigap: Also known as Medicare supplemental insurance, Medigap plans are offered by private insurers to cover the “gaps” in Original Medicare coverage. There are 10 standardized plans that are designated by the letters A-D, F, G and K-N, and each covers a different set of benefits, such as coinsurance costs, deductibles and emergency medical care in foreign countries. Only those with Original Medicare can purchase a Medigap policy since Medicare Advantage plans typically offer extra benefits that fill some of these coverage gaps.
1. Initial enrollment period
When it is: The initial enrollment period runs for seven months and includes the three months leading up to the month in which you turn 65, the month you turn age 65 and the three months afterward.
Whom it applies to: Medicare-eligible individuals who are turning age 65.
What it’s for: The initial enrollment period is for those who do not yet have Medicare and are signing up for the first time. During the initial enrollment period, you can do the following:
- Select either Original Medicare or Medicare Advantage.
- Join a prescription drug plan.
If are already receiving Social Security benefits, you will be automatically enrolled in Medicare at age 65 and should receive information in the mail prior to your 65th birthday. If you are not receiving Social Security benefits, you must apply for Medicare.
2. Special enrollment period
When it is: A special enrollment period is available for the eight months after someone stops working or their workplace health insurance coverage ends.
Whom it applies to: Those who have group health insurance through a workplace plan, including COBRA coverage, and have not yet enrolled in Medicare.
What it’s for: Those who have group health insurance through their employment or that of a spouse aren’t required to enroll in Medicare at age 65. Instead, they can wait until they leave their job or their group health insurance expires and then enroll in Medicare through a special enrollment period.
Those who already have a Medicare Advantage or Medicare prescription drug plan can also qualify for a special enrollment period in certain circumstances, such as if they move out of the service area of their current plan.
As of Jan. 1, 2023, special enrollment periods will also be available to those impacted by the following:
- Natural disasters or emergencies
- Loss of Medicaid coverage
3. Medigap open enrollment period
When it is: The Medigap open enrollment period runs for six months from the first month you have Medicare Part B coverage and are age 65 or older.
Whom it applies to: People who select Original Medicare during their initial enrollment.
What it’s for: This is the only time the federal government guarantees those with Original Medicare will be able to purchase a Medigap plan to supplement their coverage, even if they have pre-existing conditions. If you miss this enrollment period, an insurer won’t necessarily sell you a Medigap plan later, or you may have to pay a higher premium.
Some states, however, may have other Medigap enrollment periods for their residents.
4. Open enrollment period
When it is: The open enrollment period occurs annually and always runs from Oct. 15 to Dec. 7.
Whom it applies to: People who already have Medicare — either of the two main types — and wish to change their coverage.
What it’s for: During the open enrollment period, all Medicare enrollees can change their medical or drug coverage for the next year. This can include:
- Switching over from Original Medicare to a Medicare Advantage plan, or vice versa.
- Switching from one Medicare Advantage plan to another.
- Joining a drug plan, switching from one drug plan to another, or dropping drug coverage entirely.
5. General enrollment period
When it is: The general enrollment period occurs annually and always runs from Jan. 1 to March 31.
Whom it applies to: People who missed their initial enrollment period and don’t qualify for a special enrollment period.
What it’s for: During the general enrollment period, people can sign up for Medicare. Then, if they’d like, they can choose a Medicare Advantage plan or Part D prescription drug plan between April 1-June 30. Coverage starts the month after you sign up.
Just keep in mind that missing your initial enrollment period can trigger a late-enrollment penalty in the form of a higher premium for Part A, Part B or both.
6. Medicare Advantage open enrollment period
When it is: The Medicare Advantage open enrollment period occurs annually and always runs from Jan. 1 to March 31.
Whom it applies to: People who are already enrolled in a Medicare Advantage plan.
What it’s for: Beneficiaries with a Medicare Advantage plan can do the following once during this enrollment period:
- Switch to a different Medicare Advantage plan.
- Move from a Medicare Advantage plan to Original Medicare.
- Join a Part D drug plan if switching to Original Medicare.
7. 5-star special enrollment period
When it is: The 5-star special enrollment period occurs annually and always runs from Dec. 8 to Nov. 30 of the following year.
Whom it applies to: People who are already enrolled in a Medicare Advantage plan or a prescription drug plan.
What it’s for: Medicare provides star ratings to Medicare Advantage and drug plans, with 5 stars being the highest possible rating. If a 5-star plan is available in your area, you may switch to it during the 5-star special enrollment period. You can only switch plans once during this period.