To enroll or not to enroll? That is the question. Not to go too Shakespearean here, but it is a question that we encounter quite often. Like many other types of insurance coverage, when it comes to Medicare, you have a specific time frame to enroll. If you miss that enrollment period, it can mean significant penalties if left unchecked. Here are a few things to consider.
When enrolling for Medicare you have a 7 month window to do so. It starts 3 months prior to your birth month, the month of your birth and closes 3 months after that. As you’ll see in just a moment, this rule changes when you have employer sponsored coverage.
When determining whether or not you are at risk of a late enrollment penalty, the only question that needs to be answered is whether or not you have creditable coverage? What is creditable coverage? It’s simply coverage, that at the very least, is as good as what Medicare provides.
Now, there are some stipulations that go along with that. For example, creditable coverage MUST come from a current employer that you or your spouse actively works for. If the benefits you’re receiving come from either retiree benefits or COBRA, that would not be considered sufficient coverage to avoid a late enrollment penalty. The size of your employer will also have some impact as to whether or not you should make the switch sooner than later.
When you (or your spouse) works for an employer with more than 20 employees, the government requires that they offer you the same coverage as younger employees. If this is the situation you find yourself in, it’s completely up to you whether you elect to keep A) your current coverage and delay Medicare, B) forfeit your employer coverage for Medicare, or C) choose to have both coverages active at the same time.