FAQs: Medicare

This searchable page features questions commonly asked during ACE TA Center webinars on Medicare. FAQs and answers are arranged into six categories:

  • Medicare Costs and Coverage
  • Medicare Eligibility and Enrollment
  • Transitioning to Medicare from Another Form of Health Insurance, Deferring Enrollment, and Penalties
  • Social Security - Work Credits and Disability
  • Financial Assistance for Medicare Costs
  • Medicare-Medicaid Dual Eligibility

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Medicare Costs and Coverage

Once an individual’s out-of-pocket spending reaches $8,000 in 2024 (including payments made by ADAP on a client’s behalf), the individual will automatically transition to the “catastrophic coverage” phase. Once in this phase, the individual (as well as ADAP) will pay nothing for covered Part D drugs for the rest of the calendar year.

Source: ACE TA Center
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While all Medicare Part D plans must cover all HIV antiretroviral therapy (ART) medications, different Medicare Part D plans have different cost-sharing requirements for ARTs. Clients should look at each plan in their area to see which one makes the most sense for their needs. CMS has a Medicare Plan Finder Tool that clients and case managers can use to compare options. Clients can enter all their medications and see which are covered and which have copays. Remember, RWHAP clients’ copays for HIV medications can be covered by ADAP. 

Source: ACE TA Center
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Yes. ADAP assistance to help clients pay for Medicare Part D copays and coinsurance counts towards Medicare true out-of-pocket (TrOOP) costs. This will help clients get through the “donut hole” phase of their Medicare Part D prescription drug coverage.

Source: ACE TA Center
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Medicare Part D prescription drug coverage is divided into four distinct phases, each with a specific dollar amount that serves as a threshold leading into the following phase: (1) deductible phase, (2) initial coverage period, (3) coverage gap or “donut hole” phase, and (4) catastrophic coverage period.

Phase 1: In the deductible phase, individuals are responsible for paying the full negotiated price for their prescription drugs, until they reach a specific deductible amount. In 2024, this amount is $545. Once this amount has been reached, the individual moves into the next phase of coverage.

Phase 2: In the initial coverage period phase, both the individual and their health plan collectively pay towards out-of-pocket prescription drug costs, until they reach a specific amount, called the out-of-pocket threshold. In 2024, this amount is $5,030. Once this amount has been reached, the individual moves into the next phase of coverage.

Phase 3: In the coverage gap or “donut hole” phase, the individual is required to pay up to 25 percent of the costs of their prescription drugs (both brand name drugs and generics), until they reach a specific amount, called the out-of-pocket spending threshold. In 2024, this amount is $8,000. Once this amount has been reached, the individual moves into the final phase of coverage.

Phase 4: In the catastrophic coverage period phase, individuals pay zero copayments and coinsurance for their prescription drugs for the remainder of the plan year (effective January 1, 2024).

Find more information about costs in the coverage gap on the CMS website.

Source: ACE TA Center
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No. Medicare Part D is prescription drug coverage only. Medicare Advantage plans, also known as Medicare Part C, are Medicare plans that bundle (group together) Medicare Part A, Part B, and usually Part D coverage. If a client is enrolled in a Medicare Advantage plan that includes prescription drug coverage (Part D), they will not have to enroll in a separate Medicare Part D plan. If a client is enrolled in a Medicare Advantage plan that does not include prescription drug coverage, they can choose to enroll in a separate Medicare Part D plan for prescription drug coverage. 

Source: ACE TA Center
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Medicare Advantage plans, also known as Medicare Part C, are Medicare plans that bundle (group together) Medicare Part A, Part B, and usually Part D coverage. Medicare Advantage plans are managed by a private insurance carrier (e.g. Aetna or Blue Cross Blue Shield), instead of CMS. 

Medigap policies, also known as Medicare supplemental insurance plans, are optional add-ons for clients who have Original Medicare. Medigap policies help to cover some or all of the gaps in Medicare Parts A and B coverage but do not include prescription drug coverage. 

Clients with Medicare Advantage plans cannot purchase Medigap policies. 

Source: ACE TA Center
Date Published:

Medicare Eligibility and Enrollment

Clients who lose Medicare Part D coverage because of nonpayment of premiums are able to re-enroll in the same plan or a new plan as long as they repay owed premiums and enroll during an Open Enrollment period. The client will also incur a late enrollment penalty for months without creditable coverage.

Source: ACE TA Center
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Yes. Individuals who qualify for the Extra Help program can join, switch, or drop their Medicare drug plans once per quarter for the first three quarters of the year (January - March, April - June, or July - September). Any changes made will be effective the first day of the following month.

All Medicare enrollees can make changes to their Medicare health or drug coverage during the Medicare Open Enrollment period, which takes place from October 15 - December 7 every year. Any changes made during this period will take effect on January 1 the following year. 

Source: ACE TA Center
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Medicare enrollment is not mandatory. Individuals who qualify for Medicare can choose not to enroll in coverage. However, keep in mind that if an individual chooses to enroll after initial eligibility, they may have incurred late enrollment penalties. The amount of these penalties increases the longer enrollment is delayed. For this reason, it is strongly recommended that individuals enroll in Medicare when they first become eligible. 

Source: ACE TA Center
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Depending on a person’s age and the kind of health coverage they have, there may be certain times of year that they can sign up for a Medigap plan. A person can also sign up for Medigap when they first enroll in a Medicare Part B plan. If you think Medigap is a good option for your client, review this resource: When Can I Buy Medigap

Source: ACE TA Center
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Medicare enrollment assistance can be found through the State Health Insurance Assistance Program (SHIP). SHIPs are available in all 50 states, Washington D.C, Puerto Rico, Guam, and the U.S. Virgin Islands.

Source: ACE TA Center
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Supplemental Medigap plans are sold by private insurance companies. Medicare.gov has a tool to help you find one in your area, but you must purchase Medigap plans directly from the insurer. In most states, you’ll find that Medigap policies are named by letters (ex: Medigap Plan F or Medigap Plan G). If you live in Massachusetts, Minnesota, or Wisconsin, Medigap plans have different names that are not letter-based.

Source: ACE TA Center
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Typically, no. Individuals who are eligible for Medicare (and who may already be enrolled in Medicare Parts A and B) are not automatically enrolled into a Medicare Advantage plan. If the client prefers Medicare Advantage, they must elect to enroll during the Medicare Advantage Open Enrollment Period. 

In some states, some individuals who are dually eligible for both Medicare and Medicaid can be automatically enrolled into a specific type of Medicare Advantage plan called a Dual Eligible Special Needs Plan (D-SNP), but that is not the general policy for the majority of Medicare-only enrollees.

Source: ACE TA Center
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Depending on what type of Medicare coverage your client is already enrolled in and what changes they want to make to their coverage, there are multiple times throughout the year that this is possible. Generally, a person can join, switch, or drop coverage without penalties or gaps in coverage if they do so during specific Open Enrollment periods or Special Enrollment Periods. 

For example: 

  • From January 1 - March 31, a person can switch from one Medicare Advantage plan to another Medicare Advantage plan, or switch from Medicare Advantage to Original Medicare (Parts A and B) and join a Part D plan. 
  • From October 15 - December 7, a person can switch from Original Medicare to Medicare Advantage or vice versa, join a Medicare drug plan if they didn’t have one already, switch from one Medicare drug plan to another, or drop Medicare drug coverage completely, among other things.

The client can also call 1-800-MEDICARE or their Medicare Advantage plan to request disenrollment outside of the Open Enrollment period. Before moving from Medicare Advantage to Original Medicare, it is a good idea for clients to check with all of their health care providers to make sure that switching to Original Medicare won’t cause any disruptions in care. 
 

Source: ACE TA Center
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Calendar months. The Medicare Initial Enrollment Period (IEP) is a seven (7) month period centered around an individual’s 65th birthday month. It includes the individual’s birthday month, the three (3) calendar months prior to the birthday month, and the three (3) calendar months after the birthday month. For this reason, the IEP is sometimes referred to as the “3-1-3” period. For example, if your birthday is on May 15, your Initial Enrollment Period would begin on February 1 and end on August 31. This includes the three (3) calendar months prior to your birthday (February, March, and April), your birthday month (May), and the three (3) calendar months after your birthday (June, July, and August). 

Note: If your birthday is on the 1st of the month, your seven-month Initial Enrollment Period is distributed differently. It will include the four (4) calendar months before your birthday, your birthday month, and the two (2) calendar months after your birthday. Instead of a “3-1-3” distribution, it becomes a “4-1-2” distribution. For example, if your birthday is on May 1, your Initial Enrollment Period would begin on January 1 and end on July 31. This includes the four (4) calendar months prior to your birthday (January, February, March, and April), your birthday month (May), and the two (2) calendar months after your birthday (June and July).

Source: ACE TA Center
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No, but a person must be a US citizen or a legal resident for at least five years to qualify for Medicare, and they must meet one of the following criteria:

  • Age 65 or older
  • Under age 65 with a qualifying disability
  • Have End Stage Renal Disease

Source: ACE TA Center
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Social Security - Work Credits and Disability

It depends. 

Generally, if a client qualified for Medicare via the SSDI disability pathway and subsequently loses their SSDI benefits, they will also lose Medicare coverage unless they also qualify on the basis of age (65 or older) or if they have End Stage Renal Disease (ESRD).

However, there are also a number of programs that support people receiving SSDI to engage in trial work periods while maintaining eligibility for SSDI benefits and Medicare. Even after a trial work period ends and a person loses their SSDI benefits, they may still be able to maintain Medicare coverage for a certain period of time.

Learn more.

Source: ACE TA Center
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There are many health conditions and impairments that the Social Security Administration (SSA) recognizes as qualifying disabilities (called listings). These include: musculoskeletal disorders, respiratory disorders, neurological disorders, mental disorders, immune system disorders, and more. 

Individuals under age 65 can qualify for Medicare if they have a qualifying disability (as determined by the SSA) and have been receiving Social Security Disability Insurance (SSDI) benefits for at least 24 consecutive or non-consecutive months. Individuals with End Stage Renal Disease (ESRD) can qualify for Medicare at any age, without first having to receive SSDI benefits for 24 month. 

Note: According to the SSA, a diagnosis of HIV alone is not considered a qualifying disability for the purposes of SSDI eligibility. Individuals with HIV can qualify for SSDI if they have either a serious HIV-related condition, a qualifying CD4 count, repeated hospitalizations, or repeated manifestations of HIV. 

Learn More:

Source: ACE TA Center
Date Published:

No, however individuals who have received 24 months of SSDI benefits will be automatically enrolled in Medicare Parts A and B when they begin receiving their 25th month of SSDI benefits. After auto-enrollment occurs, individuals can choose to keep or decline their coverage.

For Medicare Part A, individuals can:

  • Keep their premium-free Medicare Part A coverage 
  • Decline their Medicare Part A coverage, withdraw their original Social Security application, and pay back all Social Security cash benefits

For Medicare Part B, individuals can:

  • Keep their Medicare Part B coverage and pay a premium
  • Decline Medicare Part B coverage and avoid a late enrollment penalty later if they have qualifying coverage
  • Decline Medicare Part B coverage and pay a late enrollment penalty later if they do not have qualifying coverage 

In such cases, it is advantageous for clients to enroll in one or more Medicare Parts (especially premium-free Part A) if the client needs or wants assistance with Medicare cost-sharing (through Medicare Savings Programs), prescription drug cost-sharing (through the Extra Help program), and behavioral health and/or long-term care costs. 

Source: ACE TA Center
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Individuals receiving Social Security retirement benefits before age 65 (as early as age 62) will be automatically enrolled in Medicare when they turn 65. 

Individuals under age 65 who are receiving Social Security Disability Insurance (SSDI) benefits will be automatically enrolled in Medicare when they receive their 25th month of SSDI benefits.  

Individuals receiving Supplemental Security Income (SSI) benefits are not automatically eligible for Medicare coverage. If an individual receiving SSI also qualifies for Medicare due to:

  • Age (65 or older): they may enroll in Medicare during their Initial Enrollment Period. 
  • Disability (receiving SSDI benefits for at least 24 months): they will be automatically enrolled in Medicare when they receive their 25th month of SSDI benefits. 
  • End Stage Renal Disease: they may enroll in Medicare immediately and may also be eligible for 12 months of retroactive Medicare coverage
     

Source: ACE TA Center
Date Published:

Yes, individuals can continue to earn work credits past age 65 if they do not have enough (40 credits) to qualify for premium-free Medicare Part A. They may choose to enroll in Medicare Part A at age 65 but pay a premium for Part A coverage until they have earned 40 credits. Medicare Part A premium amounts vary depending on how many credits the individual has earned. 

Source: ACE TA Center
Date Published:

No. The 40 work credits required to qualify for premium-free Medicare Part A do not have to be earned consecutively. Individuals can earn a maximum of 4 credits per year (one credit every three months) while working full time, so 40 credits is roughly equivalent to 10 years of full time work. 

Source: ACE TA Center
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You can help your client create an account (or log in to an existing account) at https://www.ssa.gov/myaccount/ to check how many work credits they have accumulated in their lifetime, as well as what benefits they are eligible for. 

Source: ACE TA Center
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Financial Assistance for Medicare Costs

Yes. Starting in January 2025, Medicare prescription drug cost sharing will be subject to a $2,000 annual out-of-pocket cap. Individuals – particularly those who are taking medications subject to very high cost sharing – will also have the option of enrolling in a Medicare Prescription Payment Plan to distribute their cost sharing responsibility over the course of the year. This means that instead of paying a large amount in cost sharing early in the plan year, an individual could choose to pay smaller amounts monthly over the course of the entire year. 

Source: ACE TA Center
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As a result of a federal law passed in 2022, the federal Extra Help program (also known as the Low Income Subsidy) has been expanded. Starting in January 2024, the program is no longer broken into two parts, with lower income individuals eligible for the full Low Income Subsidy and slightly higher income individuals only eligible for a partial Low Income Subsidy. Instead, the full Low Income Subsidy is now available to individuals with incomes of 150% of the federal poverty level and less. 

Source: ACE TA Center
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It depends. Each client should be assessed individually, as the answer depends on the client’s unique life circumstances, the assistance that RWHAP and ADAP provides in the client’s state, Medicare Advantage and Medigap plan availability, and the eligibility criteria for financial assistance programs such as Medicare Savings Programs in the area.

Medicare-eligible clients should first compare the pros and cons (including costs, coverage, and provider networks) of Original Medicare vs. Medicare Advantage plans in the area. If the client opts for Original Medicare, they should consider adding on a Medigap policy and Medicare Part D prescription drug coverage.

After enrolling in Medicare coverage (Original Medicare or Medicare Advantage), the client should review the eligibility criteria for additional financial assistance programs, including but not limited to:

Case managers should also stay up-to-date on the RWHAP and ADAP policies in their jurisdiction, including allowable costs and payor of last resort requirements.

Source: ACE TA Center
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It is very challenging for third party payors, such as RWHAP and ADAP, to pay for clients’ Medicare premiums after the premium amount has been automatically deducted from the client’s Social Security payment. As a result, for the vast majority of clients, this is not a cost that RWHAP and ADAP can pay due to the inability to coordinate with the Social Security Administration, even though it is an allowable cost that RWHAPs can pay for. This is a known issue that many RWHAPs across the country struggle with.

Source: ACE TA Center
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Many RWHAP clients who qualify for Medicare may also qualify for a Medicare Savings Program (MSP) on the basis of income. If you believe that your client meets the criteria for a MSP in your state, then you should help them apply for that program. 

Medicare Savings Programs (MSPs) are state-administered programs that help certain low-income individuals pay for some or all of their Medicare costs. There are four types of MSPs, each of which have different income and asset eligibility criteria. States may offer one to four types of MSPs and may determine the specific income and asset limits for eligible residents. Contact your state Medicaid program, which administers MSPs, to see what MSP options are available in your state. If you believe that your client meets the criteria for an MSP in your state, then you should help them apply for that program. Many RWHAP clients who qualify for Medicare may qualify for an MSP on the basis of income. Some people who qualify for an MSP automatically qualify to get Extra Help to pay for their Medicare prescription drug coverage as well. 

Source: ACE TA Center
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Yes, but keep in mind that HRSA HAB requires RWHAP recipients to “vigorously pursue” insurance for clients, including Medicare prescription drug coverage. RWHAP, including ADAP, is always available as a safety net, particularly for individuals who may have missed an open enrollment period. However, RWHAP, including ADAP, will only cover a person’s HIV care and provide medication coverage for a person’s HIV medications. RWHAP, including ADAP, is not comprehensive health coverage. 

Source: ACE TA Center
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RWHAP funds may be used to pay for Medicare premiums and cost-sharing associated with Medicare Parts B, C, and D coverage, when doing so is determined to be cost-effective in the aggregate and includes coverage for both outpatient/ambulatory health services and prescription drug coverage that includes at least one drug in each class of core antiretroviral therapeutics. Review HRSA HAB Policy Clarification Notice (PCN) #18-01 for more details about Medicare costs payable by the RWHAP, and check with your local RWHAP as policies may differ by state or jurisdiction. 

Source: ACE TA Center
Date Published:

Medicare-Medicaid Dual Eligibility

Generally, yes. Dually eligible people get their prescription drug coverage through Medicare, either through a standalone Medicare Part D plan (added on to Original Medicare) or through a Medicare Advantage plan. All Medicare prescription drug plans must cover HIV medications, including antiretroviral treatments (ART). Some state Medicaid programs also provide coverage for outpatient prescription drugs. 

If the client is interested in whether a specific medication is covered, especially non-HIV medications, they should contact their Medicare and Medicaid plan administrators and ask if it is covered by the plan’s formulary. 

Source: ACE TA Center
Date Published:

No. If an individual has Medicare coverage through a Medicare Advantage plan and Medicaid coverage through a Medicaid managed care plan, it is possible but not required for the Medicare Advantage plan and the Medicaid managed care plan to be administered by the same insurance company. There may be potential benefits to such an arrangement, such as having to contact only one insurance company instead of two. However, they will still have to navigate two separate sets of coverage and benefits, as well as billing requirements. 

Note: This type of arrangement is not the same as enrolling in a single integrated care plan that is administered by one insurer, which provides a higher level of care coordination. 

Source: ACE TA Center
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It depends. A person who is dually eligible and does not have access to an integrated care plan may benefit from enrolling in a Medicare Advantage plan (as well as their state Medicaid program) instead of Original Medicare if they:

  • Anticipate needing extra benefits such as vision, dental, and hearing services that Original Medicare does not offer
  • Have existing providers who are part of the Medicare Advantage plan’s network
  • Do not anticipate needing health care when traveling outside of the country

Note: There are special types of Medicare Advantage plans, called Dual Eligible Special Needs Plans (D-SNPs), that are available only to dually eligible people. D-SNPs tailor their benefits, provider networks, and drug formularies to meet the unique needs of dually eligible people. D-SNP enrollees are not required to also enroll in their state Medicaid program, as Medicaid benefits are already included in the plan. 

Source: ACE TA Center
Date Published:

Transitioning from Marketplace to Medicare

Clients who are currently enrolled in a Marketplace plan may be best served by ending that coverage and enrolling in Medicare once they turn 65, for several reasons.

  1. Individuals who are eligible for premium-free Medicare Part A are no longer eligible to receive subsidies (such as premium tax credits and cost-sharing reductions) to help lower the cost of their Marketplace coverage. Medicare-eligible individuals who keep their Marketplace coverage and continue receiving subsidies, will have to repay them when they file a federal tax return for that year. 
  2. Individuals who remain on Marketplace coverage and miss their Initial Enrollment Period for Medicare (for those turning 65, this is the seven month period centered around the month of their 65th birthday) may have to wait to enroll in Medicare coverage and pay a late enrollment penalty for Medicare Part B and Medicare Part D. 
  3. For individuals not eligible for premium-free Medicare Part A (these could include clients who do not have requisite work history), it still may be a good idea to enroll in Medicare, but assisters should assess the specific circumstances, particularly if the client may be eligible for any Medicare Savings Programs that may provide assistance with Medicare premiums and reduce their out-of-pocket costs.

Keep in mind that once a client is enrolled in Medicare, it is illegal for anyone who knows a client has Medicare to sell them a Marketplace plan. 

Source: ACE TA Center
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It depends.

If the client became eligible for Medicare Parts A and B before age 65, any late enrollment penalties they may have incurred (as a result of deferring Part B coverage) will automatically reset to $0 when they turn 65 and become eligible to enroll in Medicare again during their Initial Enrollment Period.

If the client became eligible for Medicare Parts A and B at or after age 65, they will likely face a Medicare Part B penalty if they choose Marketplace coverage instead of enrolling in Medicare when they first become eligible during their Initial Enrollment Period. They will be ineligible for Marketplace subsidies, such as Advance Premium Tax Credits (APTCs) and Cost Sharing Reductions (CSRs), which will increase their monthly premium amounts. 

Source: ACE TA Center
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Yes. Federal rules allow for individuals who have enrolled in Medicare (either through an Initial Enrollment Period, Special Enrollment Period, or General Enrollment Period) and who are eligible for premium-free Part A* to stay enrolled in Marketplace coverage and continue to receive Marketplace subsidies until their Medicare coverage begins. 

Once Medicare coverage begins:

  • Individuals should contact the Marketplace immediately to terminate their coverage
  • Individuals who remain enrolled in Marketplace coverage will no longer receive Marketplace subsidies and will be responsible for the full cost of coverage
  • Individuals who continued to benefit from Marketplace subsidies after their Medicare coverage began will be asked to pay back those subsidies

*Note: Individuals who do not qualify for premium-free Medicare Part A are allowed to keep their Marketplace coverage and continue qualifying for Marketplace subsidies. 

Learn more here.

Source: ACE TA Center
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Generally no, unless the individual meets the criteria for the CMS equitable relief policy, which is specific to Medicare Part B late enrollment penalties.  

To qualify for equitable relief, individuals must:

  • Have attempted to actively enroll in Medicare Part B, and 
  • Provide documentation that “error, misrepresentation, or inaction of a federal worker or an agent of the federal government (such as an employee of the Social Security Administration, CMS, or a Medicare administrative contractor) resulted in late Part B enrollment.” 

Certain time-limited equitable relief policies may also be available.

  • CMS may provide a Medicare Special Enrollment Period (SEP) for individuals affected by a weather-related emergency or major disaster to enroll in Medicare Part B without incurring a late enrollment penalty. 
  • Currently, equitable relief is available to individuals who were unable to contact the Social Security Administration after January 1, 2022 to enroll in Medicare Part B during their Initial Enrollment Period or Special Enrollment Period. This time-limited policy is available through December 30, 2022.

In all other cases, individuals who did not actively attempt to enroll in Medicare and who chose to keep their Marketplace coverage instead will likely incur Medicare late enrollment penalties if they choose to enroll in Medicare coverage at a later point.

Learn more here.

Source: ACE TA Center
Date Published:

Yes. For detailed information on how to smoothly transition from Marketplace to Medicare and avoid gaps and overlaps in coverage, view this HealthCare.gov guide on Changing from Marketplace Health Insurance to Medicare and this ACE TA Center tool on Transitioning from Marketplace to Medicare Coverage for RWHAP Clients

Source: ACE TA Center
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Yes, coverage options offered through the Marketplaces are considered “minimum essential coverage”, meaning that they meet the Affordable Care Act’s standards of affordability and comprehensiveness. 

Individuals currently enrolled in Marketplace plans are not required to switch to Medicare when they become eligible, but they may face significant late penalties if they choose to enroll in Medicare later. For this reason, it is strongly recommended that Marketplace enrollees enroll in Medicare when they first become eligible. 

Source: ACE TA Center
Date Published:

Transitioning from Employer-Sponsored Insurance to Medicare

The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives employees who lose or leave their jobs the ability to stay on their employer-sponsored coverage for up to 18 months after the employment ends. It is important to note that COBRA does not extend the enrollment period for Medicare. In other words, clients who turn 65 should enroll in Medicare within eight months of losing their employer coverage.

Source: ACE TA Center
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If a client is still working and turns 65, they can delay enrolling in Medicare Part B until they lose their employer-based coverage, as long as the employer-sponsored coverage meets a set of minimum standards. They can enroll in premium-free Medicare Part A at any time once they become eligible.

If a client has employer-sponsored coverage for themselves or via a spouse, they can keep that coverage and still enroll in Medicare. Having both employer-sponsored coverage and Medicare may reduce the client’s out-of-pocket costs. Whether Medicare will be the primary payer (i.e., whether Medicare will pay claims first and the employer-sponsored coverage pays remaining out-of-pocket costs for the client) will depend on the size of the employer and whether the client or the client’s spouse is currently employed.

For any non-group health coverage (including retiree benefits that a client may receive from a past employer), the client should reach out to the retiree plan to determine how and if the plan would interact with Medicare.

Once they retire and their employer insurance ends, they will have an eight-month Medicare Special Enrollment Period (SEP) in which to enroll in Medicare coverage with no penalties.

Source: ACE TA Center
Date Published:

Yes, but only if the employer has 20 or more employees. If your employer has fewer than 20 employees and therefore is not required to provide minimum essential coverage, then Medicare will likely not let you defer Medicare Part B enrollment without a penalty. If you are unsure, contact your employer’s Human Resources department as well as the Social Security Administration to see if you will face any penalties for staying on your specific employer-sponsored insurance plan. 

Source: ACE TA Center
Date Published:

Transitioning from No Insurance to Medicare

If a client is uninsured and receives services from RWHAP providers and/or ADAP, RWHAP recipients and subrecipients are required to “vigorously pursue” client eligibility for public and private coverage, including Medicare. If a client is eligible for Medicare, they should be encouraged to enroll. RWHAP clients who are also Medicare enrollees may continue to see RWHAP providers who accept Medicare. RWHAP may cover services not covered by Medicare. RWHAP and ADAP insurance assistance programs may help to cover clients’ Medicare premium and cost-sharing obligations

Source: ACE TA Center
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A Special Enrollment Period (SEP) is available for formerly incarcerated people who did not enroll in premium-free Part A or Part B because they were incarcerated. To be eligible for this SEP, individuals need to demonstrate they are eligible for Medicare, that they did not enroll in Medicare Part A or B during the Initial Enrollment Period because they were incarcerated, and have proof that they were released from custody on or after January 1, 2023. The SEP begins the day the client was released from incarceration and ends the last day of the twelfth month after the client was released from incarceration.  

Source: ACE TA Center
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Deferring Medicare Parts and Penalties

Clients with the requisite work history and who qualify for SSDI benefits are automatically enrolled in Medicare after a 24-month waiting period. Once these clients turn 65, their Medicare coverage will continue. SSDI benefits will automatically transition to retirement benefits. 

Source: ACE TA Center
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Yes, this is likely. Clients who lose their Medicare Part B coverage while incarcerated and re-enroll in Medicare after their release (but outside of their Initial Enrollment Period) will be charged a late enrollment penalty and will have to wait until a General Enrollment Period to enroll. However, some states allow incarcerated individuals to enroll in Medicare Savings Programs to help pay for Part B costs upon re-enrolling.

Source: ACE TA Center
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The Medicare Part B and Part D late enrollment penalties are lifetime penalties. 

The Medicare Part B penalty is an additional 10% per 12-month period that an individual was eligible for Part B coverage but did not enroll, on top of the monthly Part B premium. This additional penalty amount must be paid monthly for as long as the individual has Medicare Part B coverage. 

For example, if an individual was eligible for Medicare Part B but chose not to enroll in coverage for 2.5 years (30 months), they will have to pay an additional 20% (10% x 2, 12-month periods) on top of their monthly Part B premium for as long as they have Part B.

The Medicare Part D penalty is 1% of the national base beneficiary premium (a benchmark amount that changes annually) multiplied by the number of full, uncovered months that an individual was eligible for Medicare Part D but did not enroll or did not have creditable prescription drug coverage. This additional penalty (rounded to the nearest $0.10) must be paid monthly for as long as the individual has Medicare Part D coverage. 

For example, if an individual was eligible for Medicare Part D but chose not to enroll or did not have other creditable prescription drug coverage for 17 months, they will have to pay 17% (1% x 17 full, uncovered months) of the national base beneficiary premium. In 2022, this number was $33.37, so the penalty is $5.70 (17% x $33.37, rounded to the nearest $0.10) on top of their monthly Part D premium for as long as they have Part D. 
 

Source: ACE TA Center
Date Published:

Yes. Having a late enrollment penalty for Medicare does not impact eligibility for Medicaid or the Medicare Savings Program.

Source: ACE TA Center
Date Published:

Yes. Individuals who qualified for Medicare prior to age 65 (due to disability or having End Stage Renal Disease) will have all of their late enrollment penalties reset to $0 when they turn 65. 

Source: ACE TA Center
Date Published:

It depends. If a client cancels their Medicare Part D coverage, they will not be charged a penalty for re-enrolling at a later point - as long as they had creditable prescription drug coverage for the entire time they did not have Part D. If a client cancels their Medicare Part D coverage and did not have creditable prescription drug coverage, then they will be charged a penalty based on how many months they did not have creditable coverage. 

Source: ACE TA Center
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Transitioning from Other Forms of Coverage to Medicare

The Indian Health Service (IHS) is a federal program that delivers health care to American Indians and Alaskan Natives (AI/ANs).

Clients who receive services through Indian Health Services networks may continue to do so once they enroll in Medicare, so they should enroll in Medicare when they become eligible. The IHS providers serving Medicare enrollees may bill Medicare for services provided.

Source: ACE TA Center
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TRICARE is the uniformed services health care program for active-duty service members, active-duty family members, National Guard and Reserve members and their family members, retirees and retiree family members, survivors, and certain former spouses.

Individuals who are enrolled in TRICARE do not have to enroll in Medicare, and will not be charged a penalty for not doing so.

If a client is eligible for both Medicare and TRICARE, they may enroll in Medicare and will continue to automatically receive TRICARE coverage. Medicare will be the client’s primary payer and TRICARE can cover cost sharing (e.g., coinsurance and deductibles) and services not covered by Medicare. 

Source: ACE TA Center
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The Veterans Administration (VA) is an integrated health care system that offers a range of health care services to uniformed service members and veterans.

Individuals who receive VA services do not have to enroll in Medicare, and will not be charged a penalty for not doing so.

If a client is eligible for both Medicare and VA benefits, they are able to receive care under either program. However, the client must choose which program to use. For instance, if the client wants to use VA services, they must go to a VA facility or seek authorization from the VA to go to a non-VA facility. Medicare does not pay in this scenario. If the client goes to non-VA providers to seek care, then they may use their Medicare coverage.  

Source: ACE TA Center
Date Published:

Transitioning from Medicaid to Medicare

Because Medicaid renewals and redeterminations were suspended during the COVID-19 pandemic, there may have been clients who turned 65, but remained on Medicaid instead of enrolling in Medicare. These clients may be eligible for a new Special Enrollment Period that will allow them to enroll in Medicare without a penalty if they lose Medicaid coverage after January 1, 2023. Clients have six months from the date their Medicaid coverage ends to enroll.

Source: ACE TA Center
Date Published:

Assess the client’s eligibility to remain on Medicaid once they turn 65. State Medicaid programs may have different eligibility criteria depending on age.

As long as the client meets the eligibility criteria for both Medicaid and Medicare (also known as dual eligibility), they are able to receive coverage from both programs. A few common scenarios may include:

  • If the client was eligible for Medicaid under the Affordable Care Act (ACA) Medicaid expansion group (i.e., individuals up to 138% of federal poverty level), that coverage ends when the client turns 65 and they transition to Medicare. However, the client may still be eligible for other Medicaid eligibility categories in addition to Medicare and will be reassessed for other Medicaid eligibility categories before they turn 65. (Note: this process was different during the COVID-19 pandemic when Medicaid programs were prohibited from terminating coverage, see the question below for more information). The client may also be eligible for a Medicare Savings Program, where Medicaid can help pay for their Medicare premium and reduce their cost-sharing obligations. 
  • If the client is under 65 and enrolled in Medicaid based on another eligibility category (e.g., disability), and then becomes eligible for Medicare when they turn 65, they may continue to be eligible for full Medicaid coverage (depending on the state) in addition to being eligible for Medicare. Some state Medicaid programs end Medicaid coverage at age 65, and clients should check in with their state Medicaid programs to understand eligibility rules. Dually eligible clients may be entitled to some Medicaid services that Medicare does not cover. As stated above, even if the client is no longer eligible for another full Medicaid eligibility category, they may still be eligible for a Medicare Savings Program to help with Medicare costs. If a client was enrolled in Medicaid and Medicare and subsequently loses Medicaid coverage, they are eligible for a Special Enrollment Period to pick a Medicare Advantage plan or to enroll in traditional Medicare. This is because they will no longer be eligible for a specific type of Medicare Advantage plan only available to dually eligible enrollees called a Dual Eligible Special Needs Plan (D-SNP).

Source: ACE TA Center
Date Published:

Medicare Prescription Payment Plan

No. When a person enrolls in the MPPP, they are electing for all of their medications to be in the program.

Note: This does not change the way ADAP cost-sharing is processed. A Medicare beneficiary may elect to have their non-ADAP formulary medications in the MPPP, while their ADAP-covered medications will continue to be processed as they are currently. Refer to question 3 for examples of how this works and for more detail about why opting into the MPPP would rarely, if ever, be a good option for an ADAP client.  

Source: ACE TA Center
Date Published:

Plans will offer a two-month grace period for people who miss their monthly MPPP payment and will send reminders throughout this time to prompt payment. If a person does not pay the owed amount by the end of the grace period, they will be removed from the MPPP and will be charged the regular cost-sharing amount for their medications at the pharmacy. The person (or ADAP or other RWHAP-funded program on the client’s behalf, if feasible) will still be required to pay the amount owed to the Medicare Part D plan. However, even if the person is removed from the MPPP, they will still remain enrolled in Medicare Part D coverage. A person may pay the owed amount in one lump sum, or can pay the owed amount in monthly amounts for the remainder of the plan year. If someone has not paid the past-due MPPP amounts by the end of the plan year, they will not be able to enroll in the MPPP the following year.

Source: ACE TA Center
Date Published:

There will likely be situations in which a Medicare beneficiary enrolls into the MPPP at the beginning of the year, and enrolls into ADAP later in the year. In this instance, the RWHAP client should work with a case manager to evaluate whether or not it makes sense for the client to remain enrolled in the MPPP. For example, as discussed in questions 4, 5, and 6, it may no longer make sense for a client to remain enrolled in the MPPP if they are receiving Medicare Part D prescription drug cost-sharing assistance from ADAP. ADAP (or another RWHAP-funded program) may be able to pay the outstanding balance to the Medicare Part D plan for medications covered on the ADAP formulary. 

Source: ACE TA Center
Date Published:

Yes. A person may disenroll from the MPPP at any time by contacting the Medicare Part D or Medicare Advantage plan. However, the person will have to pay any MPPP balance owed to the plan. 

Source: ACE TA Center
Date Published:

A beneficiary will be able to sign up for the MPPP through the health or drug plan’s website, or over the phone. A person can enroll prior to the beginning of a plan year or at any time during the plan year.  When a person enrolled in the MPPP receives a prescription for a drug covered by Medicare Part D, the plan will automatically let the pharmacy know that they are enrolled in the MPPP. The pharmacy will then dispense the medication without collecting any payment at the point of sale, and the Medicare Part D or Medicare Advantage plan will bill the beneficiary the smoothed amount every month.

RWHAP staff supporting ADAP clients with Medicare Advantage or Part D enrollment need to understand the MPPP, including the drawbacks and benefits for RWHAP clients who may want to enroll into the program. It may be the case that a jurisdiction’s ADAP requires clients to opt out of the MPPP. In these circumstances, ADAP administrators should ensure RWHAP recipients and subrecipients are aware of this requirement, and case managers and other support staff should be trained on how to discuss the MPPP with clients and why their ADAP is recommending clients do not enroll. Staff will also need to know how to help clients disenroll from the MPPP, if needed.     
 

Source: ACE TA Center
Date Published:

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