Medicare Basics: 7 Facts You Should Know Before You Turn 65—So You’re Fully Prepared for Enrollment

Key Takeaways

• Medicare eligibility begins at age 65, but you can sign up as early as three months before your birthday to avoid delays or penalties.

• Understanding the different parts of Medicare (A, B, C, and D) ensures you enroll in the coverage that best suits your healthcare needs.

7 Essential Facts About Medicare Before You Turn 65

Turning 65 is a big milestone, and along with celebrations, it comes with a crucial decision: enrolling in Medicare. If you’re approaching this important age, now is the time to understand the basics, so you don’t face unexpected costs or coverage gaps. Medicare can be overwhelming, but getting familiar with the process early ensures a smooth transition. Here are seven key facts you should know before you enroll.

1. You’re Automatically Enrolled in Some Cases—But Not Always

If you’re already receiving Social Security benefits at least four months before your 65th birthday, you’re automatically enrolled in Medicare Parts A and B. However, if you’re not collecting Social Security yet, you must sign up yourself. Failing to enroll on time could result in late penalties, so it’s important to know whether you need to take action.

Even if you are automatically enrolled, it’s still essential to review your coverage. Medicare Part A covers hospital services, but Part B has a monthly premium, which you might want to defer if you have employer coverage. Understanding your status and your options in advance ensures you make the best financial decision.

2. The Initial Enrollment Period (IEP) Lasts Seven Months

Your Initial Enrollment Period (IEP) begins three months before you turn 65 and extends for three months after your birth month. Enrolling during this window prevents late penalties and ensures your coverage starts on time. If you miss this period, you may have to wait until the General Enrollment Period (January 1 – March 31), with coverage starting in July—potentially leaving you without healthcare for months.

If you’re still working and have employer-based health insurance, you may qualify for a Special Enrollment Period (SEP) once you leave your job. SEPs allow you to enroll outside the usual windows without facing late penalties, but they vary depending on your circumstances. Be sure to check your eligibility.

3. Medicare Has Four Parts—Each Covering Different Services

Medicare is divided into four main parts:

• Part A (Hospital Insurance): Covers inpatient hospital stays, skilled nursing facility care, and some home health services.

• Part B (Medical Insurance): Covers doctor visits, outpatient services, preventive care, and durable medical equipment.

• Part C (Medicare Advantage): A private alternative to Original Medicare that includes Parts A and B, and often additional benefits.

• Part D (Prescription Drug Coverage): Helps cover the cost of prescription medications.

Understanding these parts helps you choose the right coverage based on your healthcare needs and budget. If you don’t sign up for Part D when first eligible and don’t have other creditable prescription drug coverage, you’ll face a late enrollment penalty.

4. Medicare Isn’t Free—You’ll Pay Premiums, Deductibles, and Co-Pays

Many people assume Medicare is entirely free, but that’s not the case. While Medicare Part A is premium-free for most people (if you’ve paid Medicare taxes for at least 10 years), you’ll pay a monthly premium for Part B, and there are deductibles and co-pays. Part D and Medicare Advantage plans also come with separate costs. Planning ahead for these expenses ensures you’re not caught off guard.

Additionally, Medicare doesn’t cover everything. You may have to pay out-of-pocket for dental, vision, hearing, and long-term care unless you purchase additional coverage. Knowing these gaps can help you decide whether to look into supplemental insurance.

5. Delaying Enrollment Can Lead to Permanent Penalties

If you don’t sign up for Medicare Part B when first eligible and don’t have qualifying health coverage (such as employer-sponsored insurance), you’ll face a late enrollment penalty. This penalty increases your monthly premium by 10% for every full 12-month period you delay enrollment and lasts for as long as you have Medicare. Similarly, if you delay enrolling in Part D without creditable prescription drug coverage, you’ll also face a penalty.

These penalties add up over time, making Medicare more expensive than necessary. The best way to avoid them is to enroll as soon as you’re eligible unless you have other qualifying coverage.

6. Medicare and Employer Coverage Can Work Together

If you’re still working past 65 and have health insurance through your employer, you may be able to delay Medicare Part B without penalties. Whether you need to enroll right away depends on your employer’s size:

• If your employer has 20 or more employees, you can keep your employer coverage and delay Part B without penalties.

• If your employer has fewer than 20 employees, Medicare generally becomes your primary insurance, and you should enroll in Part B to avoid coverage gaps.

It’s also important to check if your employer plan qualifies as creditable coverage for Part D. If not, you could face penalties for not signing up for Medicare’s prescription drug coverage when first eligible.

7. You’ll Need to Reevaluate Your Coverage Annually

Once you’re enrolled in Medicare, your healthcare needs may change over time. Each year, from October 15 to December 7, you can review and make changes to your Medicare plan during the Open Enrollment Period. This is the time to switch between Original Medicare and Medicare Advantage, change your Part D plan, or adjust your coverage to better suit your health needs.

Medicare Advantage and Part D plans can change their costs and covered services yearly. Reviewing your Annual Notice of Change (ANOC) ensures your plan still meets your needs. Failing to do so could result in higher costs or loss of coverage for necessary medications or services.

Preparing for Medicare Enrollment: What You Should Do Next

Now that you know the essential facts about Medicare, it’s time to take action. Here are some steps to help you prepare:

• Mark your Initial Enrollment Period on your calendar to ensure you enroll on time and avoid penalties.

• Compare Medicare coverage options to determine which plan best fits your healthcare needs and budget.

• Check whether your doctors accept Medicare if you prefer to keep seeing them after enrollment.

• Review prescription drug coverage to ensure your medications are covered under the plan you choose.

• Consider additional coverage like Medigap or Medicare Advantage if you need extra benefits beyond Original Medicare.

Get Expert Help to Ensure a Smooth Enrollment

Medicare enrollment can be complex, and choosing the right coverage is a big decision. To ensure you make informed choices, get in touch with a professional listed on this website. They can help you navigate enrollment, compare plans, and avoid costly mistakes.