Multiple layers of Medicare rules can result in confusion and frustration.
I recently hosted a webinar on the fundamentals of Medicare for over 600 consumers. During the query and answer session, I spotted why Medicare is so confusing. The first query I used to be asked, “When are the seven months I have to enroll in Medicare?”, made it clear why.
You would think there ought to be a deadline for everybody to enroll, right? That was back when Medicare was introduced. In 1966, a yr after Medicare was officially introduced, 19 million people had registered. (Just a comment on this. Can you imagine the situation in today’s world if Social Security, with all of the computers and automation, needed to process 19 million claims in 12 months, or 52,000 per day?)
In the Sixties, life was undoubtedly simpler. Anyone who turned 65 was either retired or already retired and entitled to full advantages. There was Medicare for everybody. But then life got more complicated. People lived longer and retired later. Medicare interacted with all kinds of different situations – COBRA, retiree plans, SSDI, Medicare Advantage, Part D drug plans – with all kinds of different rules and policies, each constructing on the previous ones.
The IEP and the numerous confusions
Back to the query. The first enrollment period is seven months During this time, individuals who turn 65 can determine what they wish to do regarding Medicare. When this era begins and ends is determined by the date of birth. Let’s consider the instance of two twins. One shall be born on October 1 at 11:55 p.m. and the second on October 2 at 12:05 a.m. There shall be only ten minutes between their births, but they’ll have two different IEPs.
For the second twin and all those born on any day of the month except the primary, the IEP begins three months before and ends three months after the month of birth. If you enroll through the first three months, Medicare begins on the primary day of the month of birth. If you enroll through the last 4 months, coverage begins on the primary day of the subsequent month.
Medicare treats people born on the primary day of the month as in the event that they were born on the last day of the previous month. The IEP begins 4 months before and ends two months after the birth month. Enroll through the first three months, and Medicare takes effect the month before the birth month. Enroll through the last 4 months, and Medicare begins the subsequent month.
In my example, the IEP for the first-born twin would run from June 1 to December 30, and for the second twin, from July 1 to January 31. These twins could also be equivalent in every way aside from Medicare.
Additional enrollment period levels
If these twins now determine to proceed working and delay Medicare enrollment, they shall be faced with one other level, with different rules: the Part B Special Enrollment PeriodThis SEP gives individuals who retire after age 65 the chance to enroll in Medicare directly or penalty for an eight-month period that begins when insurance or employment ends, whichever comes first.
If for some reason the twins don’t complete their IEP or Part B SEP, they face one other level, the General registration periodThis is a three-month period from January 1 to March 31 of every year. Medicare takes effect on the primary day of the month following enrollment, and late enrollment penalties may apply.
In addition to those three periods for enrolling in Medicare Part A and/or Part B, there are dozens of other enrollment periods. There are three open enrollment periods: Open Enrollment (October 15 to December 7), Open Enrollment for Medicare Advantage (January 1 to March 31), and Open Medigap Enrollment (six months from age 65 and if an individual is enrolled in Part B). Then Medicare.gov deals with over 30 special enrollment situationsand more enrollment periods for all possible situations.
I could go on, but you get what I mean. Medicare involves a series of rules, policies, and procedures that result in confusion. When you are attempting to determine what to do in a given situation, remember to interrupt through the layers to get to the one which works for you. Then you may take a break and revel in a slice of seven-layer cake.
