Hello, “Retire With Riley” readers! The following is a continued look at Medicare. Specifically:
- Requirements you have to meet to become eligible for Medicare
- Information about when to enroll in Medicare
Medicare eligibility requirements
You can qualify for Medicare in three ways: turn 65, have a disability, or have one of a few specific chronic conditions. But you also have to meet certain basic eligibility requirements.
This particular aspect of Medicare is even more complex than most. The information that follows is largely from government websites (namely Medicare.gov and SSA.gov), but we also reached out to a Medicare representative to fill in certain gaps and clarify vague or inconsistent info.
General requirements
To qualify for Medicare in any way, shape, or form, you must be:
- A U.S. citizen.
- A lawful permanent resident (LPR, aka a green card holder) who has demonstrated permanent, continuous residence in the U.S. for at least five years before the month in which you enroll.
Age-based Medicare Part A requirements
Most Americans qualify for Medicare by reaching age 65. And most 65-year-olds who qualify for Medicare’s most rudimentary segment, Part A, typically receive this coverage premium-free. But to do so, they must either:
- Have at least 40 Medicare work credits.
- For 2024, you must make at least $1,730 in “covered earnings” (earnings subject to Medicare taxation) in a quarter to receive a work credit. You can accumulate a maximum of four work credits per year, at $6,920 in total earnings. But you can earn them at a much faster rate than once per quarter. For instance, if you made $6,920 in covered earnings during your first month of work, you would earn all four credits for the year; or
- Have a spouse with at least 40 Medicare work credits who is at least 62 years of age.
Disability-based Medicare Part A requirements
Some people will qualify for Medicare by either having a disability or having a specific chronic condition. Again, most of these people will qualify for premium-free Part A as long as they:
- Pass the recent work test.
- Ages 31+: Have at least 20 Medicare work credits in the 10-year period immediately before your disability began.
- Ages 24-31: Have half the years’ worth of credits as the number of years between your age and when your disability began. (Example: If you develop a disability at age 29, you would need four years’ worth of work credits—so, 16 credits—across the past eight years.)
- Age 23 and younger: Have at least six work credits in the three-year period before you developed your disability.
- Pass the duration work test.
- You will need to have accumulated a certain number of work credits before you developed your disability. Unlike the recent work test, these work credits can have been earned at any time. The Social Security Administration has a detailed table showing how many work credits you would need based on a wide range of possible ages one might have developed a disability.
If you qualify for Medicare based on a disability, you also will need to have received Social Security or Railroad Retirement Board benefits for 24 months before you can begin collecting Medicare benefits.
However, if you have amyotrophic lateral sclerosis (ALS, also known as Lou Gehrig’s disease), or you have end-stage renal disease (ESRD) and meet certain requirements, the waiting period will be waived.
Qualifying for Part A, but with premiums
Certain people can qualify for Part A but still have to pay a premium, including:
- People age 65 and older who have at least 30 work credits, or a spouse who is at least age 62 with at least 30 credits. (They’ll pay a reduced monthly premium, which is $278 in 2024.)
- People age 65 and older who have fewer than 30 work credits, or a spouse who is at least age 62 with fewer than 30 credits. (They’ll pay the full monthly premium, which is $505 in 2024.)
- People with disabilities who have exhausted all other forms of entitlement. (They’ll pay the full monthly premium of $505.)
Parts B, C, and D
Generally speaking, if you qualify for Part A, you qualify for Part B.
- If you qualify for (and enroll in) premium-free Part A, you can choose whether or not to enroll in Part B.
- If you qualify for Part A but must pay a premium, you can choose to enroll in just Part B, or enroll in both Parts A and B. But you cannot purchase Part A without Part B.
To qualify for Part C, you must be enrolled in Parts A and B and live within your plan’s service area.
To qualify for Part D, you must be enrolled in Part A or Part B.
When do you enroll in Medicare?
Age-Based Medicare
The most common way to become eligible for Medicare is reaching 65 years old. If that applies to you, there are several enrollment periods you need to know about:
Initial Enrollment Period (IEP)
As previously mentioned, one of the ways to become eligible for Medicare is reaching 65 years old.
Your Initial Enrollment Period (IEP) starts three months before you turn 65 and ends three months after the month you turn 65, giving you seven months to enroll. For example, if your birthday is June 15, your IEP starts on March 1 and ends on September 30 in the year you turn 65.
However, if your birthday falls on the first of the month, it’s slightly different—your IEP begins four months before you turn 65 and ends two months after the month you turn 65. In other words, while you still have seven months to enroll, the time frame starts and ends earlier.
Medicare coverage always begins on the first of the month:
- Premium-free Part A coverage starts the month you turn 65.
- Exception: If your birthday is on the first of the month, coverage will begin during the month before you turn 65.
- If you sign up for premium Part A and/or Part B before you turn 65, coverage begins during the month in which you turn 65.
- If you sign up for premium Part A and/or Part B during the month in which you turn 65, or during the three months after, coverage begins the following month.
The IEP also applies for Medicare Parts C and D. But note that if you sign up for a Part C during this time, you’re allowed to drop it at any point during the next 12 months and switch to Original Medicare without penalty.
If you don’t enroll for Medicare during the IEP, you’ll need to sign up during the general or special enrollment periods. If you sign up during a GEP, you’ll often have to pay a late enrollment penalty, which impacts your monthly premiums. This is a temporary penalty for Part A, but typically a lifetime penalty for Parts B and D.
General Enrollment Period (GEP)
The General Enrollment Period (GEP) for Medicare Part A and Part B is from Jan. 1 through March 31 every year. If you sign up during the GEP, your coverage begins the month after you sign up. For example, if you signed up in February, your coverage would begin in March.
If you have Medicare Part A, and you enroll in Part B for the first time during the GEP, that triggers a two-month Special Enrollment Period (SEP) in which you can enroll in Part C or Part D. If you don’t have Part A and you enroll in Part B, that triggers a two-month SEP in which you can enroll in Part D. (Remember: You must be enrolled in Parts A and B to enroll in Part C.)
Open Enrollment Period (OEP)
The Open Enrollment Period (OEP) is for Parts C and D (not Original Medicare). It runs from Oct. 15 to Dec. 7 each year. During this period, people can enroll in, change, or drop Medicare Part C and Part D plans. Any changes made during the OEP typically take effect on Jan. 1 of the following year.
Medicare Advantage Open Enrollment Period
The Medicare Advantage Open Enrollment Period is from Jan. 1 to March 31. If you are enrolled in a Medicare Advantage plan, you can use this period to make changes from your existing plan, or switch to Original Medicare (and, if you want, enroll in Part D).
Special Enrollment Period (SEP)
A Special Enrollment Period (SEP) is a one-time enrollment period triggered by any number of events, including (but not limited to):
- Dropping out of an employer plan
- Losing Medicaid coverage
- Being released from incarceration
Enrolling during one of these periods typically exempts you from any penalties.
For instance, let’s say you had health insurance through your job or your spouse’s job—you have eight months from either the end of your health care coverage or the end of your employment (whichever happens first) to enroll without being subject to a penalty.
When people sign up for Medicare Part A or Part B during an SEP, they typically have two months to join a Part C or Part D plan. Coverage then begins the first day of the month after the plan gets your request to join.
In some situations, you might qualify for an additional Medicare Advantage Special Enrollment Period. The main ways you might become eligible for a Part C Special Enrollment Period are as follows:
- You move to a new location.
- You lose current health care coverage.
- You get an opportunity to get other coverage.
- Your plan’s contract with Medicare changes.
Disability-Based Medicare
The enrollment periods for disability-based Medicare are different from that of age-based Medicare.
Initial Enrollment Period (IEP)
The Initial Enrollment Period (IEP) for people who qualify for Medicare because of a disability starts three months before their 25th month of disability payments and ends three months after.
People with disabilities can apply for Social Security Disability benefits. Once a beneficiary is deemed disabled, there is a five-month waiting period before they start collecting Social Security Disability benefits. Anyone who has been receiving Social Security Disability benefits for 24 months becomes automatically enrolled in Medicare. Individuals with ALS or permanent kidney failure requiring regular dialysis or a transplant may qualify almost immediately, and thus wouldn’t have to wait out the 24-month period.
Disability Special Enrollment Period (D-SEP)
Some people are eligible for a Disability Special Enrollment Period (D-SEP).
You might qualify for D-SEP if you declined Medicare Part B because your group health plan was paying as the primary payer when Medicare should have been doing so. How do you know who should be the primary payer? If you have disability-based Medicare and your employer has 100 or more employees, the employer-based insurance “pays primary.” To avoid the monthly premium, some people don’t enroll in Part B, which would be the secondary payer.
Once your employer’s insurance won’t pay primary anymore, you can use D-SEP to enroll in Part B without a penalty. The D-SEP period begins after the later of these two events:
- Employer notifies you that it won’t pay primary anymore.
- Medicare becomes the primary payer.
At that point, you have a seven-month period to enroll in Part B.
