This is the second in a series of columns explaining Medicare and how enrolling in Medicare can minimize and most likely eliminate a federal retiree’s out-of-pocket outpatient bills (including doctor fees, laboratory tests, and prescribed medical equipment) and inpatient bills (including hospital and skilled nursing facility expenses). The first column discussed what Medicare is, the various parts to Medicare, how federal employees qualify for Medicare, and how Medicare coordinates with the Federal Employee Health Benefits (FEHB) program. This column discusses the various enrollment periods for Medicare.
Enrolling in Medicare can be confusing and if enrollment is not completed by the required deadline, it can result in late enrollment penalties. During 2020, about 1.4 percent of Medicare enrollees – an estimated 776,200 people – paid late enrollment penalties for Medicare Part B. The result is that these late enrolled Medicare Part B enrollees are paying on average 27 percent more in their Medicare Part B monthly premiums.
Eligible Individuals can enroll in Medicare during one of the following enrollment periods, namely: (1) The Initial Enrollment Period (IEP); (2) The Special Enrollment Period (SEP); and (3) The General Enrollment Period (GEP). The three enrollment periods are discussed.
SEE ALSO: How Federal Employees Qualify For Medicare
Initial Enrollment Period (IEP)
Individuals become eligible for Medicare Part A (hospital insurance) and Medicare Part B (medical insurance) the first day of the month when they become age 65. The IEP is 7 months long centered on the month an individual becomes age 65.
Each Medicare beneficiary’s Initial Enrollment Period (IEP) is unique. The IEP depends on when the beneficiary’s 65th birthday occurs. For example, if a beneficiary’s 65th birthday occurs on October 15, then the IEP will begin on July 1 and end on January 31.
Note that Medicare (like Social Security) considers an individual to be “of eligible age” as of the day before the individual’s birthday. In the example above, the individual who becomes age 65 on October 15 will be considered per Medicare to be age 65 as of October 14.
However, if an individual’s birthday is on the first day of any month, then the individual is considered to be 65 on the last day of the previous month and the individual gets an extra month added to the beginning of the IEP. For example, if one’s 65th birthday is October 1st, then the individual’s IEP begins on June 1st and ends on January 31st.
Medicare Part A coverage becomes effective on the first day of the month they become age 65, whether an individual enrolls in Medicare during the three months before they become age 65 or during the month they become age 65. Until December 31, 2022, the start date for Part B coverage for this group varies from the month after they become age 65, to as many as six months after they become age 65, depending on when they submit their application.
Beginning January 1, 2023, if an individual signs up during the month he or she becomes age 65 or during the last three months of the individual’s IEP, the individual’s Medicare Part B coverage starts the first day of the month after the individual enrolls in Medicare.
The following chart illustrates the IEP and the effective date of Medicare Part B coverage pre-and post-2023:
If an individual who is eligible to enroll in Medicare Part B but does not sign up and then decides later to enroll in Part B, that individual’s Part B coverage could be delayed. In addition, the individual may be subject to a late enrollment penalty and pay a higher monthly premium for as long as the individual is enrolled in Part B. The individual’s monthly premium will increase 10 percent for each 12-month period he or she was eligible for Part B but did not sign up. There will be no late enrollment penalty if an individual qualifies for a Special Enrollment Period (SEP), as explained next.
Special Enrollment Period (SEP)
Individuals who do not enroll in Medicare Part B during their IEP have another chance each year to enroll during the General Enrollment Period (GEP), held annually between January 1st and March 31st, as explained below..
Those federal employees who are enrolled in an FEHB health insurance plan and who continue working in federal service past age 65 are not required to enroll in Medicare when they become age 65. Some employees do enroll in Medicare Part A when they become age 65 because there is no premium cost for Medicare Part A. These same employees choose not to enroll in Medicare Part B because of the required Medicare Part B monthly premiums.
But once these employees retire from federal service, they are required to enroll in Medicare Part B during what is called the employee’s Special Enrollment Period (SEP) in order to avoid paying a late enrollment penalty.
The SEP for a retiring federal employee with FEHB health insurance coverage and who works past age 65 is an 8-month period, starting on the effective date of an employee’s retirement. For most federal employees, the effective date of an employee’s retirement is the first day of the month following the month the employee retires. The following example illustrates.
Example 1. Janice, age 68, retired from federal service on July 30, 2025. The effective date of Janice’s retirement is August 1, 2025. Janice enrolled in Medicare Part A when she was age 65. Janice’s SEP starts August 1,2025 and ends March 31, 2026.
If a federal employee enrolled in an FEHB program retires from federal service after age 65 and enrolls in Medicare Part B during his or her SEP, then his or her Medicare Part B coverage becomes effective the month after the federal retiree enrolls in Medicare Part B.
General Enrollment Period (GEP)
The General Enrollment Period (GEP) is for individuals who did not apply during their IEP or for individuals who did not enroll during their SEP. The GEP is held every year between January 1st through March 31st. Starting January 1, 2023, those individuals applying for Medicare Part B during the GEP will have their Medicare Part B coverage effective the first day of the month after the month that they apply. The following example illustrates:
Example 2. Joseph is a federal retiree who retired from federal service at age 62. He turned 65 on April 25, 2025. His IEP began January 1,2025 and ended July 31, 2025. Joseph did not enroll in Medicare Part A or Medicare Part B during his IEP. He must wait until the next GEP (January 1, 2026 – March 31, 2026) to enroll in Medicare Parts A and B. If he enrolls during the GEP in January 2026, Joseph’s Medicare coverage becomes effective February 1, 2026. If he enrolls in Medicare during February 2026, his Medicare coverage becomes effective on March 1, 2026. If he enrolls in Medicare during March 2026, his Medicare coverage becomes effective on April 1, 2026.
Late Enrollment Penalties
When an individual does not enroll in Medicare during his or her appropriate enrollment period (IEP, SEP or GEP), the individual could be subject to a late Medicare enrollment penalty. Penalties for each part of Medicare are calculated separately. For example, an individual will be subject to a late penalty for Part A only when the individual pays a Part A premium. An individual would be paying a Medicare Part A premium if he or she did not have 10 years of Medicare Part A covered employment (did not pay the Medicare hospital insurance tax) during his or her working years. Since most individuals do not pay a premium for Part A, most individuals never incur a late enrollment penalty for Part A.
The late enrollment penalty for Part B is calculated by taking 10 percent of an individual’s premium and multiplying it by the number of whole years delayed. This penalty is added to the individual’s monthly Part B premium each month and never ceases. The penalty is lifelong. More details about the Medicare Part B late enrollment penalty will be presented in a future column.