As your 65th birthday approaches, you have decisions to make regarding your healthcare and health insurance coverage. Original Medicare is one of the most common options. In fact, there are more than 44 million Medicare beneficiaries in the U.S. It is made up of two parts: Part A (hospital insurance) and Part B (medical insurance), though you may also see information about Part C (Medicare Advantage Plans) and Part D (prescription drug coverage).

So when you turn 65, are you automatically enrolled? How and when can you enroll? Understanding options and deadlines can help ensure you have the coverage you need when you need it while also avoiding late penalties.

Are you automatically enrolled in Medicare?

While most seniors will choose Medicare as their primary health insurance coverage, typically you are not automatically enrolled, and must sign up for Part A and Part B when you are eligible.

One exception is if you’re already getting benefits from Social Security or the Railroad Retirement Board (RRB). If you are getting these benefits for at least four months before you turn 65, you’ll be automatically enrolled in Part A and Part B starting the first day of the month you turn 65.

If you are eligible for Medicare because you are disabled, you’ll be automatically enrolled in Part A and Part B after you receive disability benefits from Social Security for 24 months.

In these cases, you should automatically receive the “Welcome to Medicare” package that gives you information you need about coverage, as well as your red, white, and blue Medicare card. You should read this package to decide:

• If you want to keep Part B coverage.
• How you want to get your Medicare coverage (if you keep Part B).
• If you want or need Part D (prescription drug coverage).
• If you want to buy a Medicare Supplement Insurance (Medigap) policy.

If you are close to turning 65 and are not getting Social Security or RRB benefits, you must sign up for Medicare. Even if you are eligible for premium-free Part A coverage, you still must enroll.

If you aren’t getting Social Security benefits, you will not automatically receive any information from Medicare. You must call Social Security at least three months before the month you turn 65 to avoid any late penalties.

If you’re still working and have employer group coverage, you likely do not need to sign up for Medicare right away. Talk to your employer to learn whether or not the plan is the primary insurer. If it’s not, you will need to sign up for Part A and Part B, as they would help pay some of the costs not covered by your group health plan.

How to apply for Medicare at 65

In order to apply for Medicare, you must meet the eligibility requirements, and you must enroll during a particular enrollment period.

Medicare eligibility

To be eligible for Medicare, you must meet these requirements:

• You are turning 65 or have a qualifying disability.
• You or your spouse worked and paid Medicare taxes for at least 10 years.
• You are a U.S. citizen or permanent legal resident who has lived in the U.S. for at least five years.
• You are receiving Social Security or RRB benefits, or have worked long enough to be eligible for those benefits but are not collecting them yet. 

Medicare enrollment periods

There are a few times per year when you can sign up for Medicare. Once you are enrolled, you will receive the “Welcome to Medicare” package that gives you information you need about coverage, as well as your red, white and blue Medicare card.

Initial Enrollment Period

If you’re eligible for Medicare when you turn 65, you are able to sign up during your Initial Enrollment Period. This is a 7-month period surrounding your birthday, including the three months before the month you turn 65, the month you turn 65, and the three months after the month you turn 65.

If you do not pay a premium for Part A, it’s mandatory to enroll unless you also give up your Social Security or Railroad Retirement Board (RRB) benefits. In most cases, you should only decline Part B if you have group health insurance from an employer you or your spouse is actively working at, and that insurance is primary to Medicare, meaning it pays before Medicare does.

If you do not sign up for Part B when you’re eligible, and you do not have other coverage in place, you’ll have to pay a late enrollment period.

You should sign up for Part A and Part B when you’re first eligible to avoid a delay in coverage. If you wait until after the month you turn 65, your coverage may be delayed depending on your birthday.

If you enroll during the first three months of your Initial Enrollment Period:

• If your birthday is not the first day of the month, your coverage starts the first day of your birthday month.
• If your birthday is the first day of the month, your coverage will start the first day of the month prior.

If you enroll during the month you turn 65, your coverage will start one month after your enrollment. If you enroll one month after you turn 65, the coverage starts two months after enrollment. For enrollment two or three months after you turn 65, coverage begins three months after enrollment.

Special Enrollment Period (SEP)

If you don’t enroll in Part A or B during your Initial Enrollment Period, you may have an opportunity to enroll during a Special Enrollment Period. However, you must meet certain requirements to be eligible, such as:

• You’re covered under a group health plan based on current employment. In this case, you can sign up for Part A and/or Part B any time as long as you or your spouse is working, and you’re covered by a group health plan through the employer.

If you enroll during an SEP, your coverage will begin the month after Social Security gets your completed request.

You are not eligible for an SEP if you have COBRA or retiree health plan coverage that ends, if you have Veterans Affairs or Individual Health Insurance Marketplace coverage, or if you have End-Stage Renal Disease (ESRD).

General Enrollment Period (GEP)

If you don’t enroll when you’re first eligible, and you don’t qualify for an SEP, you can still enroll during the Medicare General Enrollment Period, from January 1 through March 31. Your coverage will begin the month after you sign up.

How to enroll

To enroll, you can:

• Apply online at www.ssa.gov.
• Visit your local Social Security office.
• Call Social Security.
• Call the RRB (if you worked for a railroad).
• If you already have Part A and want Part B, you must complete an Application for Enrollment in Part B.

You do not have to sign up for Medicare each year. However, you will have the opportunity each year to review your coverage and make changes to your plan, such as enrolling in a Part C (Medicare Advantage) plan or adding Part D drug coverage.

To enroll in Part C or Part D, you must also actively enroll in those plans. You can do so in each of the enrollment periods listed above.

What is a late enrollment penalty?

If you do not enroll in Medicare on time, you may have to pay a late enrollment penalty. This is to help prevent people from not purchasing the coverage they need for hospital and medical services.

Part A late enrollment penalty

If you’re eligible for premium-free Part A coverage you will not have to pay a late enrollment penalty, even if you decide to enroll after you first become eligible.

However, if you aren’t eligible for free Part A coverage, you will have a penalty if you don’t enroll when you’re first eligible. In most cases, your monthly premium will increase 10%, and you’ll have to pay that higher premium for twice the number of years you were eligible for Part A but didn’t have it. For example, if you were eligible for Part A for three years but didn’t enroll, you’ll have to pay a 10% higher monthly premium for six years.

The late enrollment penalty is only applicable if you did not qualify for a Special Enrollment Period.

Part B late enrollment penalty

If you don’t sign up for Part B when you’re eligible, you will most likely have to pay a late penalty. This penalty will last for as long as you have Part B.

To calculate the penalty, take your standard monthly premium amount and increase it by 10% for each 12-month period you could have had Part B but didn’t. For example, if you could have had Part B for two years but didn’t, you’d have to pay a 20% penalty. Your monthly premium would be increased by 20% for as long as you have Part B.

For example, for the standard Part B premium of $174.40 per month, your penalty would be an additional $34.88 per month, bringing your monthly premium to $209.28 for the year 2024.

Do you have to pay for Medicare?

Medicare Part A and Part B have different costs associated with them. With each, you could pay a monthly premium, and have different deductible, copay and coinsurance costs.

Part A costs

Monthly premium

You do not have a monthly premium for Part A coverage as long as you or your spouse paid Medicare taxes for at least 10 years (40 quarters) while working.

If you have not paid the applicable taxes, you may purchase Part A coverage if you’re 65 or older and have or are enrolling in Part B coverage. You must also be a U.S. citizen or legal permanent resident. If you paid Medicare taxes for less than 30 quarters (7.5 years), you’ll pay up to $505 per month in 2024. If you paid for 30-39 quarters (7.5-9.75 years), you’ll pay $278 per month.

Deductible

In 2024, the Part A deductible is $1,632 per benefit period. You must pay this much out-of-pocket before Medicare kicks in and contributes to medical costs.

Copays and Coinsurance

With Part A coverage, you rarely have to pay a copay for hospital stays, skilled nursing home stays, or hospice care. In most cases, these copays are covered by Medicare. One exception is if you’re in hospice, you may have a copay for prescription drugs you receive.

However, you may have annual coinsurance costs with Part A depending on the length of your stay in a hospital or covered facility. This includes:

• $0 for days 1-60
• $408 per day for days 61-90
• $816 per each lifetime reserve day after day 90 (up to 60 days over your lifetime)
• Beyond lifetime reserve days, you are responsible for all costs.

Part B costs

Monthly premium

In 2023, the standard monthly premium for Part B coverage is $174.40. If your income (as reported on your IRS tax return from two years prior) is above $103,000, you may pay a higher premium.

If you get benefits from Social Security, Railroad Retirement Board (RRB) or the Office of Personnel Management, your Part B premium is automatically deducted from your benefit payment.

If you do not receive any of those benefits, you’ll receive a bill from Medicare.

Deductible

In 2024, the Part B deductible is $240 per year. You must pay this much out-of-pocket before Medicare kicks in and contributes to medical costs.

Copays and Coinsurance

Part B also covers most copayments. Most of the time you won’t have a copayment when you visit the doctor, though you may sometimes have one if you get outpatient hospital or mental health services.

You will have coinsurance costs once you reach your deductible. In most cases you’ll pay 20 percent of the Medicare-approved amount for:

• Most doctor services (including medically necessary services and preventive services)
• Outpatient therapy
• Durable medical equipment (DME)

With Original Medicare, the Medicare-approved amount is the amount a doctor or supplier that accepts assignment can be paid. By accepting assignment, they agree to accept the Medicare-approved amount as full payment for covered services. In some cases, this could be less than the actual amount the doctor charges. Medicare would cover part of this amount (typically 80%) and you’d pay the remaining cost (typically 20%).

What is Medicaid?

Medicare and Medicaid are not the same. Medicaid is a state-run program that provides hospital and medical coverage for people with low income. Each state has rules regarding who is eligible and what is covered. While some people can qualify for both Medicare and Medicaid, they are separate programs with separate coverage, eligibility requirements and enrollment periods. For more information on Medicaid, contact your Social Security office or visit www.Medicaid.gov.

Additional resources

• ClearMatch Medicare: Find a Medicare Plan
• Medicare.gov: Costs