The three Medicare deadlines that cost people money

The three deadlines that cost people money

Medicare is full of dates. Most of them do not matter much. Three of them do.

Miss one of these three and the cost is not a scolding letter. It is a penalty that can follow you for the rest of your life. The rules are public and the math is simple. But nobody sits you down and explains them.

The three windows

• The birthday window. A seven month window built around the month you turn 65. This is the front door to Medicare.
• The working window. A special window for people who keep a job and its health plan past 65. You can enroll any time while that coverage lasts, and a short clock starts when it ends.
• The yearly window. October 15 to December 7, every year. This is when you can change your plan for the year ahead.

Here is why the stakes are real. Medicare Part B pays for doctor visits, and for care that does not need an overnight hospital stay. Its standard premium, the monthly bill, is $202.90 in 2026. Sign up two full years late, with no other coverage that counts, and Medicare adds 20 percent. That is about $40.58 more every month.

It is not a one time fee. You pay it every month, for as long as you have Part B. For most people, that means for life. And the penalty grows whenever the premium grows.

One note before the math. This guide is education, not personal advice. Rules have exceptions. Your State Health Insurance Assistance Program, called SHIP, gives free one on one help with your own situation.

The next three lessons walk through each window, one at a time. Each window hides a trap that catches smart, careful people. One trap in lesson two has cost some retirees years of penalties. Here is how all three work, and how to walk past them.

1

Your seven month window around your 65th birthday

Medicare calls your first signup window the Initial Enrollment Period. Think of it as your birthday window.

It lasts seven months. It opens three months before the month you turn 65. It includes your birthday month. It closes three months after your birthday month.

Say you turn 65 on June 18, 2027. Your window runs from March 1, 2027 through September 30, 2027.

When your coverage actually starts

Timing inside the window matters.

• Sign up in the three months before your birthday month. Coverage starts the month you turn 65.
• Sign up during your birthday month or the three months after. Coverage starts on the first of the next month.

That second rule took effect on January 1, 2023. Older articles describe waits of two or three months. Those articles are out of date.

What missing the window costs

Miss all seven months and you wait for the General Enrollment Period. That runs January 1 to March 31 each year. Coverage starts the month after you sign up. In the gap, you have no Medicare at all.

Then comes the penalty. Part B is the part of Medicare that pays for doctor visits and outpatient care. Its standard premium is $202.90 per month in 2026. The penalty adds 10 percent for each full 12 month period you skipped. Periods shorter than 12 months do not count.

Here is the math in plain words. Two full years late means a 20 percent penalty. Twenty percent of $202.90 is $40.58. Your monthly bill becomes $243.48. That is $486.96 more per year, at 2026 rates.

The penalty does not wear off with time. It lasts as long as you have Part B. For most people who enroll at 65 or later, that means for life. It is also not frozen. It is a percentage of each year's premium, whatever that premium is. When the premium rises, the penalty rises with it. Every year. For life.

Drug coverage has its own penalty. Part D is the part of Medicare that pays for prescriptions. Its penalty is 1 percent of a national base amount per full month without drug coverage. That base amount is $38.99 in 2026. Fourteen uncovered months works out to about $5.50 per month, added for as long as you have drug coverage.

2

The special window if you are still working

Lots of people work past 65 now. If you have health coverage from a current job, you can usually wait on Medicare. The birthday window rules relax. But a different clock takes over, and it is unforgiving.

The eight month rule

When the job ends, or the job's health coverage ends, a special window opens. Whichever one ends first starts the clock. You then have eight months to sign up for Part B without a penalty. Part B is the part of Medicare that pays for doctor visits. You do not have to wait for the clock. You can sign up any time while you still have coverage from a current job.

Miss those eight months and you wait for the January 1 to March 31 general window. You also pick up the lifetime penalty from the last lesson.

The COBRA trap

COBRA is a law that lets you keep a former employer's health plan for a while. You pay the full cost yourself. It feels like job coverage. Medicare does not treat it that way.

COBRA does not count as coverage from a current job. Taking COBRA does not pause or restart the eight month clock. The clock started when your active employment, or its coverage, ended. People coast on COBRA for a year, then discover their window closed months ago.

The 20 employee rule

Company size decides who pays your medical bills first.

With 20 or more employees, the job's plan pays first and Medicare pays second. Delaying Part B carries no late penalty while that coverage lasts. Many people at companies that size choose to delay. Confirm the company's size and how your plan treats employees over 65 with your benefits office before relying on it. With fewer than 20 employees, Medicare pays first, even if you never signed up. The job's plan can then pay only its smaller, second place share. Skip Part B at a small company and you can be left holding most of the bill.

The savings account catch

A health savings account, or HSA, is a tax free account tied to certain health plans. IRS rules say no new deposits for any month you have Medicare.

Here is the catch. Sign up for Medicare well after 65 and Part A coverage backdates up to six months. Part A is the hospital part, and for most people it is free. The backdating can turn your recent HSA deposits into excess contributions. The IRS charges a 6 percent tax on those, for each year they stay in the account. If you apply after 65, a common practice is to stop HSA deposits six months beforehand. Whether and when to stop, and how to fix any excess deposits already made, depends on your situation. Run the timing past a tax professional first.

Two more clocks worth knowing

The drug coverage window is much shorter than eight months. You get two full months after the month your creditable drug coverage ends. Creditable means at least as good as Medicare's standard drug coverage. The drug penalty starts building after 63 days in a row without it.

Original Medicare is the government-run version, Parts A and B together. Medigap is private insurance that fills its gaps. Under federal rules, one guaranteed window opens. It starts the first month you are both 65 and enrolled in Part B. It lasts six months. Federal law does not repeat it, though limited protections return in a few situations, such as your plan shutting down. Some states add their own windows, and a few require insurers to sell year round. Delaying Part B also delays that window, so the two deadlines travel together. Which order suits you depends on your health coverage plans and your state's rules. A SHIP counselor can walk through your case for free.

3

The yearly window to change your plan

The first two deadlines happen once. This one comes back every year, and skipping it quietly costs money.

The fall window

Medicare's yearly Open Enrollment runs October 15 to December 7. Changes take effect on January 1. Your new plan must receive the request by December 7.

During this window you can:

• Join, drop, or switch a Medicare Advantage plan. Medicare Advantage is the private plan version of Medicare.
• Move between Original Medicare and Medicare Advantage, in either direction.
• Join, drop, or switch a Part D drug plan. Part D is the prescription part.

Why this matters: plans are one year contracts. Every fall, plans change their premiums, their drug lists, and their doctor networks. A drug that costs you little this year can move to a pricier tier next year. Your plan mails an Annual Notice of Change each September. If you do nothing, your plan rolls over as written for the new year. Doing nothing is a choice, and some years it is an expensive one.

The January window people confuse it with

A second window has a confusingly similar name. The Medicare Advantage Open Enrollment Period runs January 1 to March 31. It is only for people already in a Medicare Advantage plan.

In the January window you can switch to a different Medicare Advantage plan. Or you can drop it and return to Original Medicare. If you do that, you may also join a drug plan. That is the whole list. You cannot move from Original Medicare into Medicare Advantage. You cannot switch drug plans while staying on Original Medicare.

The one afternoon checklist

Everything above compresses into one sitting. You need your phone, last year's plan papers, and maybe one call to your benefits office. Most people finish in an afternoon. None of these steps commits you to anything. They put the dates where the deadlines cannot sneak past you.

• Write down the month you turn 65. If your birthday falls on the first, shift one month earlier.
• Count back three months from that month. That is when your birthday window opens. Write that down too.
• Set a phone reminder for the first day of that opening month.
• Set a second reminder that repeats every October 15, for the yearly plan review.
• Still working? Ask your benefits office whether the company has 20 or more employees.
• Ask the same office whether the drug coverage is creditable. Ask for that answer in writing.
• If retirement is coming, write down the date your coverage will end. Count eight months forward for Part B. Count two months forward for drug coverage. The shorter one controls your drug deadline.
• Fund a health savings account? If you plan to apply for Medicare or Social Security after 65, ask a tax professional when your deposits should stop. The common practice is six months before you apply.
• Make a one page list of your doctors and every prescription you take. Keep it with your Medicare papers for plan comparisons.
• Find last September's Annual Notice of Change, or watch the mail for the next one.
• Note what you pay now for premiums and prescriptions, so next fall's changes stand out.
• If a window has already passed, call Social Security anyway. Special rules cover some situations, and asking costs nothing.

The people who lose money to these three windows almost never lose it on purpose. They lose it because nobody told them the clock was running. Now you know where every clock sits.