When it comes to understanding Medicare, eligibility and enrollment is often the most difficult thing. There are multiple times during which someone can enroll in Medicare, as well as a variety of eligibility criteria, some of which overlap and some which don’t. This is intended as a rough guide that can help you understand the basics of Medicare enrollment, election periods, and eligibility.

Eligibility: The basics

Before you enroll in Medicare, you have to be eligible. You are eligible for Medicare under the following conditions:

• You are 65 years of age or older
• You have end-stage renal disease (ESRD)
• You are eligible for Social Security Disability Insurance or receive disability benefits

These are the basic eligibility conditions for all of Medicare, and most people who enroll will fit the first condition. There are other complications for eligibility, especially related to those with disabilities. This form of Medicare will require a waiting period, and eligibility can also end after a certain period. However, the full details are out of the scope of this article.

Enrollment periods: When can you sign up for Medicare?

Before getting into the details of enrollment periods, let’s take a look at how these function at a general level. The basic idea here is that you have to enroll in Medicare health insurance at a specific time, on a specific schedule, and under certain circumstances. You can’t simply enroll whenever you want.

Different enrollment periods have different guidelines and rules for health care enrollment and happen at different periods of the year. There are two fixed enrollment periods and two variable enrollment periods. Let’s look at the variable periods first.

Initial Enrollment Period: The best time to enroll?

The Initial Enrollment Period (IEP) is the easiest time to enroll, for most. This is a 7-month period, and consists of your 65th birthday month, three months prior, and 3 months after. It doesn’t matter when your birthday is during your birthday month, so someone born on August 1st and someone born on August 31st will have the same Initial Enrollment Period.

During your IEP, you can enroll in Original Medicare (Parts A and B) easily and without penalty. If you already receive Social Security benefits or Railroad Retirement Board benefits, then you will be enrolled automatically. Your premiums for Medicare Part B will be taken from your benefits check.

If you want to defer your enrollment to a later time, you will have to contact the Social Security Administration to do so. However, this can result in late enrollment penalties, which we’ll discuss in more detail later on.

The ICEP: IEP for Medicare Advantage

The ICEP, or Initial Coverage Election Period, is a period that will overlap with the IEP for most individuals, since you can sign up for a Medicare Advantage plan once you have Parts A and B. During your ICEP, you can choose to enroll in a Medicare Advantage plan, and the plan will have to accept you unless they have reached their limit.

Also known as Medicare Part C, these private insurance plans combine your Medicare benefits into a plan that resembles the health insurance many of us had through an employer. Every Medicare Advantage plan is required to provide the same benefits you get with Original Medicare, but most (over 95%) provide additional benefits as well.

Costs and benefits can vary widely, so it's important to compare Part C plans carefully. Look beyond the monthly premium to the full cost of the plan (including deductibles, coinsurance or copays, and the yearly out-of-pocket max), as well as any additional benefits the plan includes.

You can do this easily with our Find a Plan tool. Just enter your zip code to review costs and benefits of Medicare plans in your area.

Special enrollment for special situations

The other variable enrollment period is the Special Enrollment Period or SEP. This is a period that is triggered by certain life events that can change your insurance status. This includes things like marriage, moving across the country, or losing your employer-based coverage. The length of Special Enrollment Periods will vary depending on your situation.

If you know in advance that you are triggering an SEP, for example, if you are retiring from your job, get in touch with Medicare beforehand, so you can use the SEP optimally. If something has come as a surprise, get in touch soon so that you can explore your options for as much time as possible.

Learn 15 ways to qualify for an SEP.

The General Enrollment Period

The General Enrollment Period is the first of the fixed periods we’ll be looking at. This period lasts from January 1st to March 31st each year. This period is useful if you didn’t enroll in Original Medicare and do not have a Special Enrollment Period. Under these circumstances, you can enroll in Original Medicare during General Enrollment.

Once you sign up for Parts A and B, you may then sign up for a Part C plan, or choose a standalone Part D prescription drug plan.

The Annual Enrollment Period: Change your Medicare coverage

Annual Open Enrollment lasts from October 15th to December 7th of each year, with health coverage beginning on January 1st. You may also hear this period referred to as the Annual Election Period.

You can use Annual Enrollment to switch from Original Medicare to Medicare Advantage, or vice versa. Additionally, you can switch from one Medicare Advantage plan to another, including adding a prescription drug plan through Medicare Advantage.

You can also use this time to add on a Part D prescription drug plan, whether you have Original Medicare or Medicare Advantage. Note that if you have prescription drug coverage through your Part C plan, you can't add a Medicare Part D plan as well.

Watch out for late enrollment penalties

If you don’t enroll in Medicare during your Initial Enrollment Period or a Special Enrollment Period, then you will have to pay a late enrollment penalty. These penalties can be severe, so you should do everything you can to avoid them.

For Part A, you will have to pay a 10% increase in monthly premiums for double the number of years that you could have had Part A, but didn’t. So, if you defer enrollment and then don’t enroll in a Special Enrollment Period, only to finally enroll two years later, you will pay your higher premium for four years.

The Part B late enrollment penalty is even more severe. For this penalty, you will pay a 10% increase in your premiums for every year that you could have had Medicare but didn’t, for the entirety of the time that you have Part B. So, if you defer for 5 years, then your premium will be 50% higher each month. This penalty lasts for the entire time you have Medicare.

Additional resources

• ClearMatch Medicare: Find a Medicare Plan
• Medicare.gov: Costs
• Social Security Administration: Extra Help