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Pros and Cons of Delaying your Medicare Enrollment

If you want to delay enrolling in Medicare, you typically will have the opportunity to enroll later. You’re generally first eligible to enroll in Medicare 3 months before you turn 65 if you qualify through age or 3 months before your 25th month of receiving Social Security disability benefits if you qualify through disability. Your Initial Enrollment Period is 7 months. It includes the three months before your qualifying event, the month of your qualifying event, and three months after your qualifying event. If you miss this Initial Enrollment Period, there could be both benefits and penalties for enrolling later.

Medicare enrollment: Part A and Part B delay

You may be enrolled in Medicare Part A (hospital insurance) and Part B (medical insurance) automatically when you are eligible. Having Medicare does not mean you have to forfeit other coverage. If you’re receiving employer coverage or coverage from another source, you can also have Medicare. If you are doubly insured, in some cases Medicare will pay your health care bills first and in some cases your other insurance will pay first.

Most people get Medicare Part A premium-free if they’ve worked 10 years, meaning there is not really a reason to delay this coverage. However, there is a monthly premium associated with Medicare Part B that most people have to pay. If you have other coverage, you may want to delay your Medicare Part B enrollment to avoid paying this premium. When you lose your employer or other coverage you may be eligible for a Special Enrollment Period to enroll in Medicare Part B without a penalty.

However, if you don’t have employer or other coverage and you delay Medicare Part B enrollment, there are two major cons.

  • You could pay all your medical expenses out-of-pocket. This includes primary care doctor visits, specialist visits, preventative care, and durable medical equipment.

  • You could pay a late-enrollment penalty when you do enroll in Medicare Part B, which is 10% more for every 12-month period that you were eligible for Medicare Part B but didn’t enroll. You will have to pay this higher premium for as long as you have Medicare.

Medicare enrollment: Part D delay

Medicare Part D is prescription drug coverage. Since Medicare Part A and Part B generally don’t cover prescription drugs you take at home, you need Medicare Part D if you want help paying for your prescriptions. Most stand-alone Medicare Part D plans are offered by private companies approved by Medicare and charge a monthly premium. If you delay enrolling in Medicare Part D, you save yourself from paying this premium. However, there are two major cons of delaying enrollment in Medicare Part D.

  • If you don’t have prescription drug coverage and suddenly need to take an expensive prescription, you could pay out of pocket.

  • If you enroll in Medicare Part D after your Initial Enrollment Period, you could pay a late-enrollment penalty for the lifetime of your plan. The way to avoid this penalty is to have “creditable” prescription drug coverage from another source during the time you were eligible to enroll in Medicare Part D but did not enroll. Creditable prescription drug coverage is coverage that’s expected to pay, on average, at least as much as Medicare’s standard prescription drug coverage.

Medicare enrollment: Medicare Supplement delay

A Medicare Supplement Insurance Plan can work alongside Original Medicare and cover costs like coinsurance, copayments, and deductibles. When you are first eligible to enroll, you can select any plan available to you without being subjected to medical underwriting. Medical underwriting is when insurers consider your health conditions and potential costs to them when deciding whether or not to offer you coverage.

However, if you delay your Medicare enrollment and miss your Initial Enrollment Period, you could be subject to medical underwriting. This means that delaying Medicare enrollment could result in you not getting the Medicare Supplement plan you want or any Medicare Supplement plan at all.

Medicare enrollment: Medicare Advantage delay

Medicare Advantage is another way to get your Medicare Part A and Part B benefits from a private insurance company that contracts with Medicare. Medicare Advantage must cover, at a minimum, everything that Original Medicare (Part A and Part B) covers but also often has extra coverage for prescription drugs, routine dental, routine vision and routine hearing. There is no penalty for enrolling in a Medicare Advantage plan after your Initial Enrollment Period. In fact, you could have Original Medicare for years, even decades, before deciding to switch to Medicare Advantage. The major con of delaying enrollment in Medicare Advantage is you could be paying for various services that Original Medicare generally doesn’t cover out of pocket, such as routine dental, routine vision, and routine hearing.

When can I enroll in Medicare plans?

The Open Enrollment Period for stand-alone Medicare Part D Prescription Drug Plans and Medicare Advantage plans is October 15-December 7 every year. The changes you make during that period will apply to the following year. You can apply for Medicare Supplement plan at any time but you may be denied if you don’t meet underwriting requirements.

This information is not a complete description of benefits. Contact the plan for more information. Limitations, copayments, and restrictions may apply.

Benefits, premiums and/or copayments/co-insurance may change on January 1 of each year.

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