If you do not sign up for Medicare Part B when you are first eligible, during your Initial Enrollment Period (IEP), you may have to wait to get coverage. You may also have to pay a late enrollment penalty.
The only time you can safely wait to sign up after your IEP is if you or your legal spouse are still working for a large employer and you have group health insurance from that same employer. In this case, you get a Special Enrollment Period (SEP). The SEP lets you sign up for Part B later without paying a penalty. (The rules are different if you have ESRD.)
Your SEP lasts for 8 months. It starts when your active employment ends or when your group health coverage ends—whichever happens first. Retiree insurance and COBRA do not count as active employer coverage and do not give you a SEP. They are usually not considered primary insurance. Instead, they pay after Medicare, whether or not you have actually signed up for Medicare. This means that if you stop working, are eligible for Medicare, and do not enroll, you will not have primary insurance—even if you have retiree coverage or COBRA. These plans can ask for their money back if they paid when Medicare should have paid first.
If you miss your IEP and do not qualify for a SEP, you can only sign up for Part B during the General Enrollment Period (GEP). The GEP happens each year from January 1 through March 31. Your coverage will start on the first day of the next month.
Most people who sign up during the GEP will have to pay a permanent late enrollment penalty. This penalty is added to your monthly Part B premium. The penalty is 10% of the current year’s base Part B premium for every 12-month period you were eligible for Medicare but did not enroll and did not have active employer group health coverage.
It can be complicated so contact HICAP for assistance.