You can only enroll in Medicare during certain Medicare enrollment periods. Most plans also have enrollment periods, beyond which you cannot make any changes. Medicare is a government sponsored program, and plans are sold by private insurance companies which have to follow guidelines set by the CMS (Centers for Medicare and Medicaid Services).
Original Medicare and the Plans
Original Medicare have part A (hospital) and part B (outpatient) coverage. If you have paid Medicare taxes for more than 40 quarters during your work years, you are automatically eligible for part A. Part B premium is about $144/month for year 2020. Although parts A and B cover large portions of your potential medical bills, the remainder of the bills is still uncapped. For example, if part B pays 80%, you will be responsible for the remaining 20% that does not have a limit. This is why you need plans on top of the original Medicare. Detailed benefits of parts A & B can be found on the Medicare government website.
Types of Plans
There are 2 main types of plans (not including the part D prescription drug plans, PDP): Medicare Advantage (MA) plans (a.k.a. part C) and medigap (a.k.a. Medicare supplement, or med-sup) plans. Many MA plans come with a PDP, which we refer to as MAPD.
Original Medicare enrollment periods include IEP (Initial Enrollment Period), GEP (General Enrollment Period), and SEP (Special Enrollment Period). MA and/or PD plans enrollment periods include ICEP (Initial Coverage Election Period) , AEP (Annual Enrollment Period), OEP (Open Enrollment Period), and SEP. Medigap plans are open for enrollment anytime, but only offer guaranteed issue during specific SEP’s.
For Advantage plans, you don’t have to answer medical questions other than if you have ESRD (End Stage Renal Disease) which makes you ineligible. On the other hand, medigap plans determine your plan premium by medical screening. Once you are enrolled in a medigap plan, the plan benefits will never change. On the contrary, MA(PD) plans send you an ANOC (annual notice of change) every year.
Medigap plans are plans sold by private insurance companies that follow CMS guidelines. Beneficiaries have to bring both the Medicare card and the medigap membership card when visiting doctors. Advantage plans are original Medicare with ‘add-on’s administered by private insurance companies. Beneficiaries do not even need to bring the Medicare card when seeing a doctor.
Medicare Enrollment Periods
Other than situations which automatically enroll you in Medicare, you have to take action to get enrolled. If you are already receiving Social Security benefits for 24 months, you will be automatically enrolled in Medicare. If you are already receiving social security benefits, you will be automatically enrolled in Medicare when you turn 65. Following is the various enrollment periods:
Initial Enrollment Period (IEP)
The IEP is the period of time you can enroll in Medicare for the first time, without getting hit with a late-enrollment penalty. If you are turning age of 65, your IEP starts 3 months before the month of your birthday and lasts for 7 months. For example, if your birthday is September 6, your IEP will be between June 1 and December 31.
General Enrollment Period (GEP)
If you missed your IEP, you can enroll during the GEP (January 1 – March 31 of each year). You can avoid the late-enrollment penalty (LEP) if you do not miss coverage for an entire 12-month period. Note that the coverage start date, if enrolled during the GEP, is July 1. Part B LEP is 10% of part-B premium for each full 12 months missed. You will have to pay this penalty as long as you keep your part B.
Special Enrollment Period (SEP) for original Medicare
If you did not sign up for part B because you were still covered under employee group insurance, you get an SEP of 8 months following the month your group insurance ends.
Initial Coverage Election Period (ICEP)
You become eligible for Medicare Advantage plans (part C) only if you are entitled to part A and enrolled in part B. Your ICEP starts 3 months before the month both of your parts A & B coverage starts. It lasts until the month before the coverage starts or the end of your IEP, whichever is later.
Annual Enrollment Period (AEP)
AEP (October 15 – December 7) is the time of the year when you can make changes to your plan. You can switch to another MA/PD plan or you can go back to original Medicare (i.e., dis-enroll from the existing plan). If you enroll in a new MA/PD plan, you will be automatically dis-enrolled from the previous MA/PD plan. If you would like to enroll in a medigap plan, you will have to dis-enroll from the existing MA/PD plan. Beware that enrolling in a standalone PDP will also automatically dis-enroll you from the existing MA/PD plan, which can leave you without medical coverage.
By the end of September every year, your plan will send you an ANOC. You should carefully review the document and make necessary changes of plan during the coming AEP.
You can find additional explanation of the AEP on this medicare plans website.
Open Enrollment Period (OEP)
OEP (January 1 – March 31) is your last chance to make a change to your plan until the next AEP. One thing you cannot do during the OEP is to enroll in an MA/PD plan if you have not already enrolled in one. However, you can switch from one MA/PD to another, or go back to original Medicare.
Special Enrollment Period (SEP) for Plans
SEP varies depending on the plan and your situations.
For medigap gauranteed issue: in most cases, the SEP starts 60 days before your current coverage ends and it lasts another 63 days after your coverage ends. This SEP applies to involuntary ending of plans and your permanent move (out of service area). In the case of your trial right, you may have up to additional 12 months of SEP. You have a trial right for Medicare Advantage plans for up to 12 months during which you can end the trail at any time.
For MA/MAPD/PD Plans:
For most situations, the SEP is 2 months long. For example, permanent move: generally 2 months after the move. (Depending on when you tell the plan about the move, you may have extra time.) Some exceptions are as follows.
If Medicare terminates its contract with your plan, you get an SEP starting 2 months before and ending 1 month after the contract ends.
If you lose your eligibility for a special needs plan (including C-SNP and D-SNP), e.g., you are no longer eligible for Medicaid, you get an SEP of 3 months.
non-renewal SEP is between December 8 and end of February (12/8-2/28). The SEP is available for beneficiaries that are enrolled in an MA/MAPD/PDP plan that will be discontinued by the CMS.