If you’re nearing retirement, you probably have questions about enrolling in Medicare. While Medicare can provide much-needed medical coverage in retirement, the program is vast, and the enrollment process can be confusing. And until this year, there were important gaps in coverage that retirees needed to factor into their retirement plans. These recent changes will alter the start date for Medicare Part B benefits and help close the coverage gap for many recipients.
Medicare Enrollment Periods
If you’re new to Medicare, learning when and how to enroll can be confusing. For starters, most people become eligible for Medicare when they turn 65. Medicare Parts A and B are required for eligible retirees and if you don’t sign up on time, you could owe late enrollment fees.
Those who are already receiving Social Security when they turn 65 will be automatically enrolled in Medicare Parts A and B. However, if you are not receiving Social Security, you will need to sign up for Medicare. Based on your circumstances, there are several different enrollment periods:
- Initial Enrollment Period: A 7-month period including the three months before your 65th birthday, the month of your 65th birthday, and the 3 months after your 65th birthday.
- General Enrollment Period: January 1 through March 31 of each year.
- Special Enrollment Period: An additional enrollment period for those with special circumstances, like retiring after becoming eligible for Medicare.
You might assume that your benefits would start immediately after submitting your application during one of the approved enrollment periods. However, there have historically been delays between application and benefit start dates for Medicare Part B. This left unprepared beneficiaries with a gap in coverage. Fortunately, Medicare changed the rules for 2023 and future years to minimize these coverage gaps.
Changes to Medicare Part B Start Dates
The Social Security Administration recently announced changes to the beginning date of Medicare Part B benefits for those who sign up during the Initial Enrollment Period and General Enrollment Period. These changes do not impact the dates during which you can enroll or the enrollment process. They only shorten the waiting period between application and the start of benefits.
Changes to Benefit Start Dates Under the Initial Enrollment Period
In prior years, if you signed up for Medicare Part B during the last three months of your Initial Enrollment Period, your benefits would start 1-3 months later. Beginning January 1, 2023, benefits will begin the first day of the month after you sign up.
Changes to Benefit Start Dates Under the General Enrollment Period
Previously, if you signed up for Medicare Part B during the General Enrollment Period, your benefits would begin July 1. Now, benefits will begin the first day of the month after you sign up.
These changes will minimize the length of time new Medicare enrollees spend without coverage. However, you may still face a delay between retirement and becoming eligible for Medicare, or other circumstances could leave you vulnerable to unexpected medical costs while you wait for Medicare coverage to begin. The best way to protect your finances is to speak with an experienced financial advisor that can help you prepare for unforeseen medical costs.
Get Answers to Your Medicare Questions with Meld Financial
If you need help understanding your Medicare options, reach out to the team at Meld Financial. Our advisors have the experience to answer your most pressing retirement questions and help you navigate the transition to Medicare.
Our team will develop your Financial Fingerprint™, a comprehensive wealth management plan that is quick to assemble, easy to understand and simple to modify as your circumstances change. This nimble plan accounts for Social Security and Medicare benefits as well as your individual goals, investments, and risk tolerance. With Financial Fingerprint™ and a partnership with an experienced advisor, you can enter retirement with confidence.
Contact us today to get started.