What Are the Most Common Medicare Enrollment Mistakes?

Failing to sign up at the right time can be one of the biggest mistakes you make with Medicare. That’s why it’s important to understand how Medicare rules apply to your own situation. Otherwise, Medicare enrollment mistakes can cost you time and money.

You Assume Medicare Enrollment Is Automatic

If you are 65 years old and already receive Social Security — either retirement or disability benefits — you are automatically enrolled in Medicare Part A hospital insurance and Medicare Part B health coverage.

But if you don’t already receive Social Security benefits, you must sign up for Medicare on your own.

Enrollment in Medicare Part D prescription drug coverage is never automatic.

You may choose to delay Medicare benefits if you’re still working and receive qualified health coverage through your employer.

However, in most cases, you should still enroll in Medicare Part A during your initial enrollment period. That’s because most people don’t pay monthly premiums for Part A.

You Miss the Initial Enrollment Window

You have seven months to sign up for Medicare when you first become eligible around your 65th birthday.

Your initial enrollment period is a seven-month window that starts three months before you turn 65. This window includes your birth month and extends three months after that.

If you are not automatically enrolled in Medicare, you must fill out an online application with the Social Security Administration to sign up for Part A and Part B.

If you miss your initial enrollment period, you get another chance during the annual general enrollment period, which runs from Jan. 1 to March 31.

If you miss both enrollment periods, you may face late enrollment penalties for Part A, Part B or Part D.

You Don’t Sign Up for Medicare Once You Stop Working

The standard full retirement age is no longer 65. It is 66 for people born between 1943 and 1954, and then it gradually increases to 67 for people born in 1960 or later.

People often choose to work until their full retirement age or older to maximize their Social Security benefits.

In most cases, you can delay signing up for Medicare if you’re still enrolled in acceptable health insurance through your employer, or your spouse’s employer.

But once that private coverage ends, you have a limited time to sign up for Medicare.

You are eligible for what’s known as a special enrollment period up to eight months after you no longer have job-based insurance.

You Ignore Late Enrollment Penalties

If you ignore your enrollment periods, you may face lifelong late enrollment penalties.

Part A Late Enrollment Penalty

Some people must buy Part A because they don’t qualify for premium-free Part A.

If this is your situation and you don’t buy Part A when you’re first eligible, your monthly premium may go up 10 percent.

You’ll pay this surcharge for twice the number of years you delayed signing up. For example, if you were eligible for Part A for three years but you didn’t sign up, you’ll have to pay the higher premium for six years.

Part B Late Enrollment Penalty

The Part B late enrollment penalty can increase 10 percent for each 12-month period you were eligible for Medicare Part B but didn’t take it.

This penalty lasts for as long as you have Medicare.

Part D Late Enrollment Penalty

It’s voluntary to enroll in Medicare Part D prescription drug coverage.

But if you don’t sign up when you’re first eligible, you may face a penalty if you enroll later.

This penalty will last as long as you have Medicare Part D.

Medicare calculates the penalty by multiplying 1 percent of the “national base beneficiary premium” — which is $33.06 in 2021 — times the number of full months you went without Part D or creditable coverage.

Medicare Late Enrollment Penalties at a Glance
Medicare Part ALasts twice the number of years you delayed signing up.
Medicare Part BContinues to rise for every 12 months you wait to enroll.
Medicare Part DCalculated using a base number that is adjusted each year times the number of months you delayed enrollment.

There is an exception for people who qualify and enroll in a Medicare Savings Program or the Extra Help program.

These programs help low-income older adults pay for Medicare out-of-pocket costs.

You may escape paying penalties if you qualify for one of these programs.

You Fail to Review Your Coverage During the Open Enrollment Period

You have an annual opportunity to review your current Medicare coverage and make changes during the open enrollment period.

This window lasts from Oct. 15 to Dec. 7 each year.

During this time, you can:
  • Switch to Original Medicare (Part A and Part B) from a Medicare Advantage plan, or vice-versa.
  • Move from one Medicare Advantage plan to another.
  • Move from one Part D plan to another or purchase one if you did not do so when first eligible.

While you are not required to make any changes during the open enrollment period, most experts recommend at least reviewing your current coverage.

Medicare Advantage and Part D plans are administered by private companies who often tweak their costs and coverage each year.

Just because your health plan worked before doesn’t mean it still serves you well. Comparing costs and making changes during open enrollment may save you money next year.

Last Modified: October 7, 2021

5 Cited Research Articles

  1. Kunkle Roberts, D. (2020, October 28). Avoid These Common Medicare Open Enrollment Mistakes This Fall. Retrieved from https://www.forbes.com/sites/forbesfinancecouncil/2020/10/28/avoid-these-common-medicare-open-enrollment-mistakes-this-fall/?sh=3ac9bccc697a
  2. Bunis, D. (2020, October 1). 10 Common Medicare Mistakes to Avoid. Retrieved from https://www.aarp.org/health/medicare-insurance/info-2019/common-medicare-mistakes.html
  3. Medicare.gov. (n.d.). Part A late enrollment penalty. Retrieved from https://www.medicare.gov/your-medicare-costs/part-a-costs/part-a-late-enrollment-penalty
  4. Medicare.gov. (n.d.). Part B late enrollment penalty. Retrieved from https://www.medicare.gov/your-medicare-costs/part-b-costs/part-b-late-enrollment-penalty
  5. Medicare.gov. (n.d.). Part D late enrollment penalty. Retrieved from https://www.medicare.gov/drug-coverage-part-d/costs-for-medicare-drug-coverage/part-d-late-enrollment-penalty