Question: I received a letter from Medicare saying I might have to sign up for Part B. I have insurance through my employer. What should I do?

Answer: This question had many possible answers. The letter you received from Medicare is part of an effort to make sure those eligible for Part B are appropriately enrolled. Remember that Medicare Part A, B and D all have different rules. In this article I am speaking to the rules regarding Medicare Part B only.

For those individuals who have only Medicare Part A, Centers for Medicare and Medicaid Services (CMS) sends a letter stating that you may need to sign up for Medicare Part B. You received the letter because you have Medicare Part A only AND it is currently the General Enrollment Period (GEP) allowing you to sign up for Medicare Part B, January 1 to March 31 each year. If you failed to sign up for Medicare Part B when you should have, you can sign up during the annual GEP and your Medicare Part B will start July 1. The letter informs you about the GEP and the general rules of the GEP.

When you are working and carry insurance from your current employer, you may not need Medicare Part B. The Medicare Part B exemption requires your employee group must be larger than 20 employees if you are over 65 (larger than 100 employees if you have Medicare due to a disability). As long as your employee group meets those size requirements, and you carry insurance through your current employee group, you do not need Medicare Part B at this time. This rule also applies if your coverage is through your spouse and their current employer coverage.

Once you or your spouse stop working, or decide to drop the employee coverage, you have a Special Enrollment Period (SEP) to sign up for Medicare Part B. There is paperwork you file to start Medicare Part B. Once your coverage begins you will begin to pay the Medicare Part B premium ($170.10 per month for most enrollees).

When you turned 65, you were working with insurance, or covered by your spouse’s employer insurance, you signed up for Medicare A and refused Part B because you had insurance from another source. You made the correct decision in this scenario. Your Part B decision will have to change when you or your spouse stop working. This decision could also change because your current insurance coverage is more expensive than Medicare Part B. When you drop your employee coverage and request Part B to start immediately you are fine, as there is no gap in coverage.

You have 8 months to sign up for Medicare Part B after your employer coverage ends. Now I would not recommend going for 8 months without Part B insurance coverage, but sometimes that happens.

If you go more than 8 months without Part B coverage AND no insurance from an employment source, you will have only the GEP to sign up for Part B, January 1 to March 31 each year. When you sign up for Medicare Part B during this GEP your Part B starts July 1. This is a significant delay in insurance and has a premium penalty. The Part B premium penalty is 10% for each 12 months without appropriate coverage. The 10% penalty is based on the current Part B premium (10% of $170.10) and lasts for the rest of your life.

You can see I don’t recommend delaying enrollment in Medicare Part B. The penalties and delay of coverage can be significant.

Other scenarios where individuals miss enrollment into Medicare Part A & Part B are when they have insurance through a past employer which continued to cover them after retirement, a COBRA plan or a Marketplace Plan. These reasons are NOT good reasons to delay Part B. If you are not going to work, carrying COBRA insurance or a Marketplace Plan and are eligible for Medicare, you MUST enroll in Medicare Part A & Part B. (There may be a reason to delay Medicare with a Marketplace Plan, but not for most people.)

In some instances, individuals are offered insurance at a lower cost or no cost to them when they first leave work, so they keep this insurance and then don’t sign up for Medicare Part B. You will have a penalty and restrictions in signing up for Medicare Part B. If you are not going to work for the company that provides the health insurance to you, you need to have Medicare A & B.

The letter you received from CMS should prompt you to think about your situation and be sure that it is okay to not have Part B. I try to impress the importance of this GEP because there are not many SEP’s available to get you into Medicare Part B.

Thinking and making decisions about Medicare is often “If this than that, but if that then this” type thinking. It makes it hard to understand and follow the right path for you.

Senior Life Matters is a community based program sponsored by Lutheran Jamestown. For questions and concerns or to reach Janell Sluga, GCMC, call 716-720-9797 or email SLM@lutheran-jamestown.org.