Medicare Enrollment Changes

On April 22, 2022, the Centers for Medicare and Medicaid Services (CMS) proposed a rule to simplify and expand Medicare enrollment rules for Part A and B. In particular, new rules have been proposed which would change how effective dates are assigned, and new special enrollment periods would apply to individuals who meet exceptional conditions.

Enrollment Simplification for Medicare Part A & B

Under current rules, the date when an individual’s coverage becomes effective depends on when they enroll. There is a 7-month window to sign up for Medicare during an Initial Enrollment Period (IEP). It starts 3 months before turning age 65, includes the month an individual turns 65, and ends 3 months after turning age 65.

• If an individual enrolls during any of the first 3 months of their IEP, their coverage becomes effective on the first month of eligibility (i.e., the first of the month before turning age 65).
• If an individual enrolls during their IEP in the month they become eligible, their coverage will be effective on the first of the month after they sign up (i.e., the first of the month after turning age 65).
• If an individual enrolls during any of the last 3 months of their IEP, their coverage will be effective on the first of the month 2-3 months after they sign up.
• If an individual does not enroll during their IEP but enrolls during the General Enrollment Period (GEP), which runs from January 1st through March 31st of each year, coverage is effective on July 1st.

Under the proposed rule, coverage will become effective on the first of the month after enrollment for individuals enrolling in the last 3 months of their IEP or during the GEP. If finalized as proposed, these enrollment changes will be effective as of January 1, 2023.

New Special Enrollment Periods for Part A & B

Currently, there is only a Special Enrollment Period (SEP) for individuals who delay enrollment in coverage because they are covered by a group health plan due to their own active employment or a spouse’s active employment. An SEP is needed to avoid any potential late enrollment penalty. CMS is proposing to expand the SEPs available to individuals who meet exceptional conditions and who missed a Medicare enrollment period, without having to wait for the GEP and without having to pay a late enrollment penalty.

Specifically, CMS is proposing the following SEPs:

• An SEP for individuals impacted by an emergency or disaster that would allow CMS to provide relief to those beneficiaries who missed an enrollment opportunity because they were impacted by a disaster or emergency declared by a federal, state, or local government entity.
• An SEP for health plan or employer error that would provide relief in instances where an individual can demonstrate that their employer or health plan materially misrepresented information related to enrolling in Medicare timely.
• An SEP for formerly incarcerated individuals that would allow individuals to enroll following their release from correctional facilities.
• An SEP to coordinate with termination of Medicaid coverage that would allow individuals to enroll after termination of Medicaid eligibility.
• An SEP for other exceptional conditions that would, on a case-by-case basis, grant an enrollment period to an individual when circumstances beyond the individual’s control prevented them from enrolling during the IEP, GEP, or other SEPs.