For the vast majority of Americans who look forward to receiving Medicare health benefits, eligibility is as uncomplicated as celebrating your 65th birthday. But your eligibility to receive Medicare coverage without having to pay a premium – and your eligibility for other Medicare plans – depends on such factors as your work history and your health status. Here’s what you need to know:
Medicare Part A eligibility
Generally, you’re eligible for Medicare Part A if you’re 65 years old and have been a legal resident of the U.S. for at least five years. In fact, the government will automatically enroll you in Medicare Part A at no cost when you reach 65 as long as you’re already collecting Social Security or Railroad Retirement benefits.
If you’re already receiving Social Security or Railroad Retirement benefits, all you need to do is check your mail for your Medicare card, which should automatically arrive in the mail about three months prior to your 65th birthday (or the 25th month of a disability, if you’re becoming eligible for Medicare due to disability rather than age). The card will arrive with the option to opt-out of Part B (see below), but opting out of Part B is only a good idea if you still have employer-sponsored coverage that provides the same or better coverage. (See our article about Part B enrollment issues.)
If you’re not already receiving Social Security or Railroad Retirement benefits, you’ll need to enroll in Medicare during a seven-month open enrollment window that includes the three months before the month you turn 65, the month you turn 65, and the three following months. If you enroll before the month you turn 65, your benefits will start the month you turn 65 (or the month before, if your birthday is on the first of the month). If you enroll in the three months after you turn 65, your coverage could have a delayed effective date.
In addition to turning 65, people can become eligible for Medicare due to a disability (eligibility for Medicare starts after you’ve been receiving Social Security or Railroad Retirement Board disability benefits for two years), or due to end-stage renal disease (ESRD) or amylotrophic lateral sclerosis (ALS). People with ESRD become eligible for Medicare on the fourth month of dialysis treatment, or earlier if they take part in home-dialysis training. People with ALS become eligible for Medicare the same month their disability benefits begin.
Most people don’t have to pay a premium for Medicare Part A. You’re eligible to receive Part A coverage premium-free if:
- You are 65 and you or your current or former spouse has paid Medicare taxes for at least 10 years.
- You’re not yet 65, but you’re disabled and you or your spouse has paid Medicare taxes for at least 10 years. After you’ve received Social Security disability benefits or Railroad Retirement Board disability benefits for two years, you’ll be eligible for Medicare, with no premiums for Part A (the two-year waiting period does not apply for people with ESRD or ALS). In the case of a disabled child, eligibility for Medicare is based on a parent’s work history, and this can continue after the child reaches adulthood.
If you (or your spouse) have not been paying Medicare (FICA) taxes for at least 10 years, you’ll still be eligible to buy Part A coverage, but you’ll need to pay a premium, which varies based on your work history. Your premium in 2018 will be $422 a month if you’ve paid into Medicare less than 7.5 years, and $232 a month if you’ve paid FICA taxes for at least 7.5 years but less than 10 year of FICA taxes.
Medicare Part B eligibility
When you receive notification that you’re eligible for Medicare Part A, you’ll also be notified that you’re eligible for Part B coverage, which is optional and has a premium for all enrollees. Part B costs $134/month for most new enrollees in 2018, although Part B costs more if your income is more than $85,000 or $170,000 for a married couple.
It’s important to enroll in both Part A and Part B. If you enroll in Part B during your initial enrollment period (the seven months surrounding the month you qualify, beginning three months prior to the month you turn 65 in most cases), Part B will kick in on the first day of the month you turn 65. While you can enroll in the three months following your 65th birthday, it’s best to enroll in Part B early, or you could have gaps in health coverage. If you wait too long, you could end up locked out of Part B and have to wait until the next general Medicare enrollment period.
If you don’t enroll during your initial window, you won’t lose eligibility for Part B, but you will be penalized with an increased premium when you eventually enroll, which climbs 10 percent for each year that you’re eligible but don’t enroll in Part B. The General Enrollment Period (GEP) for Medicare A and B runs from January 1 to March 31 each year, for coverage effective July 1 (with an increased premium if the late enrollment penalty applies).
Medicare Advantage eligibility
If you’re eligible for Medicare benefits, you have to choose how to receive them – either through the government-run Original Medicare program, or through Medicare Advantage. About two-thirds of all Medicare beneficiaries use Original Medicare as of 2017, and the other third use Medicare Advantage.
You need to have both Medicare Part A and Part B in order to enroll in Medicare Advantage, and you can select a plan during your Medicare initial enrollment period (seven months surrounding the month you qualify for Medicare).
Most Medicare Advantage plans also include Part D prescription drug coverage; if you have an MA plan, you typically receive your Part D coverage together with the health and hospital benefits, in one single package.
If you’re enrolling in Medicare because you have end-stage-renal disease (ESRD), you generally won’t be eligible for Medicare Advantage, and will need to instead obtain your coverage through Original Medicare.
Medicare Part D eligibility
To be eligible for Medicare Part D prescription drug coverage, you must have either Medicare Part A or Part B, or both. You can sign up for Medicare Part D at the same time that you enroll in Medicare Part A and B.
As mentioned above, most people who select Medicare Advantage must receive their Part D prescription benefits as part of that same Medicare Advantage plan. There are only a few, limited exceptions, including if you happen to be enrolled in what’s called a Private Fee-for-Service (PFFS) Medicare plan. (Most people aren’t.)
As with Part B, you are still eligible for Part D prescription drug coverage if you don’t enroll when you’re first eligible, but you may pay higher premiums if you enroll later on, unless you had creditable coverage from another plan during the time that you delayed enrollment in Part D.
If you’re enrolled in both Medicare Part A and Part B, and don’t have Medicare Advantage or Medicaid benefits, then you’re eligible to apply for a Medigap policy. These plans are standardized, and are designed to cover some or all of the out-of-pocket costs that are incurred when you have a Medicare-covered claim (ie, they pay some or all of your deductible and coinsurance).
You have a federal right to buy a Medigap during the six months beginning after you’re both 65 years old and have enrolled in Part B. This is known as your Medigap open enrollment period. After this time runs out, you will have only limited chances to purchase one down the road. Some states allow people of any age or health status to purchase Medigap coverage at any time without medical underwriting, but most don’t. In many states, Medigaps aren’t an option for people who have Medicare before age 65.
The primary factor that will affect your ability to purchase the policy – regardless of your health – will be whether you enroll during your Medigap Open Enrollment Period.
If you don’t enroll during the six months that starts with the month you turn 65, carriers in most states are allowed to use your medical history to determine eligibility for coverage and to set your premium if you apply for coverage later on. Read more about Medigap plan eligibility and enrollment.