Key Takeaways

• Even if you understand the general structure of Medicare, there are lesser-known rules that could impact your choices, timelines, and costs.

• Delays or misunderstandings in enrollment and coverage can result in penalties, coverage gaps, or surprise expenses—so reading the fine print matters.

Medicare Starts at 65, But the Enrollment Period Actually Begins Sooner

It’s true that Medicare eligibility typically begins at age 65, but you don’t start signing up at 65. The Initial Enrollment Period (IEP) begins three months before your 65th birthday, includes your birthday month, and continues for three months after. This seven-month window is your first opportunity to enroll.

Missing it can lead to penalties and delays:

• If you enroll after your birthday month, coverage may be delayed.

• If you miss the entire window, you may need to wait for the General Enrollment Period (GEP), which runs from January 1 to March 31, with coverage starting July 1.

You May Be Automatically Enrolled—But Not Always

If you’re already receiving Social Security benefits at least four months before turning 65, you’re typically automatically enrolled in Medicare Parts A and B.

However, if you delay Social Security and plan to claim later, you must manually enroll in Medicare. Assuming automatic enrollment when you’re not receiving benefits could lead to missed deadlines and lifelong late penalties for Part B.

Working Past 65? The Size of Your Employer Matters

If you or your spouse are still working and covered by employer-sponsored insurance, you may be able to delay Medicare without penalties—but only if the employer has 20 or more employees.

• If the employer has fewer than 20 employees, you must enroll in Medicare when first eligible.

• Even with larger employers, it’s often advisable to enroll in Part A since it’s typically premium-free (if you paid Medicare taxes for 40 quarters), but you should weigh that decision if you have a Health Savings Account (HSA).

HSAs and Medicare do not mix. Once enrolled in Medicare, you can no longer contribute to an HSA, even if you’re still working.

The Part B Late Enrollment Penalty Is Permanent

If you delay Part B without having other creditable coverage, you’ll face a penalty that lasts for life. This penalty increases your monthly premium by 10% for each full 12-month period you were eligible but didn’t enroll.

For example, waiting three years could mean a 30% higher Part B premium—for life.

Medicare Doesn’t Cover Everything (Even the Essentials)

Even after you enroll in Medicare Parts A and B, there are significant gaps in what is covered:

• Dental care (cleanings, dentures, extractions)

• Vision exams for glasses or contacts

• Hearing aids and exams

• Long-term custodial care

• Routine foot care

You’ll either pay for these services out of pocket or need to explore other insurance options to supplement your coverage.

Medicare Part D Has a Deductible and Cost Thresholds

Prescription drug coverage under Medicare Part D isn’t automatic—you need to enroll. And it’s not just one set cost. For 2025:

• The maximum deductible is $590.

• After reaching the deductible, you enter the initial coverage phase where you share costs.

• Once your out-of-pocket expenses reach $2,000, you enter the catastrophic coverage phase, where your plan covers 100% of covered drug costs for the rest of the year.

If you don’t enroll in Part D when first eligible and lack creditable coverage, you’ll face a monthly penalty that increases the longer you delay.

Not All Doctors Accept Medicare Assignment

Doctors who accept Medicare fall into three categories:

• Participating providers accept Medicare assignment, meaning they agree to Medicare’s approved rates.

• Non-participating providers accept Medicare but may charge up to 15% more.

• Opt-out providers do not accept Medicare at all, and you must pay the full cost.

Before scheduling care, confirm whether your provider accepts Medicare assignment to avoid unexpected bills.

Medicare Advantage Plans Replace Original Medicare—but with Trade-Offs

Enrolling in a Medicare Advantage (Part C) plan means you’re no longer using Original Medicare for your coverage. Instead, you get your benefits through a private plan that must cover at least the same services as Parts A and B—but the way services are delivered can differ significantly:

• Networks may be restricted to specific providers or regions.

• Referrals may be needed for specialists.

• Out-of-pocket limits apply, which don’t exist with Original Medicare.

Review each plan carefully. Perks like fitness memberships or dental coverage often attract attention, but plan structure and network access should be top priorities.

You Can’t Have Both Medigap and Medicare Advantage

If you’re considering ways to fill the coverage gaps in Original Medicare, a Medigap (Medicare Supplement) plan can help. However, you cannot enroll in both a Medigap plan and a Medicare Advantage plan at the same time.

They are mutually exclusive:

• Medigap pairs with Original Medicare (Parts A and B).

• Medicare Advantage replaces Original Medicare.

Switching between the two may not always be simple, especially after your Medigap open enrollment window, which is six months from the start of your Part B coverage. After that period, Medigap insurers may deny coverage or charge more based on your health.

Medicare Doesn’t Cover Foreign Travel—With Few Exceptions

Medicare generally does not cover healthcare outside the United States and its territories. Some exceptions exist in limited emergency circumstances (such as if you’re in the U.S. and a foreign hospital is closer), but most international healthcare costs are your responsibility.

Some Medigap plans do offer limited foreign travel emergency coverage, but you must review the terms carefully. Medicare Advantage plans may include foreign coverage, but it varies greatly.

Income Affects Your Medicare Costs

Most people pay the standard premium for Part B and Part D, but if your income exceeds certain thresholds, you’ll pay Income-Related Monthly Adjustment Amounts (IRMAA).

For 2025:

• The standard Part B premium is $185.

• If your income (based on your 2023 tax return) exceeds $106,000 for individuals or $212,000 for couples, you’ll pay more.

• The same applies for Part D premiums.

It’s important to note that these adjustments are based on your income from two years prior. If your income has decreased due to retirement or life changes, you can request a reconsideration from Social Security.

You Can’t Enroll in Everything at the Same Time

Your choices with Medicare come in layers, and you often need to enroll in multiple components separately:

• Part A and Part B (Original Medicare)

• Part D (Prescription Drug Coverage)

• Medigap (if desired)

• Medicare Advantage (as an alternative to Original Medicare)

Each type has its own enrollment rules, penalties, and timelines, so it’s critical to understand how they interact.

For instance, if you choose to go with Medicare Advantage, you typically don’t need a separate Medigap or Part D plan—because these are usually bundled in.

Enrollment Mistakes Are Common—and Costly

A significant number of people make decisions that result in higher costs or gaps in coverage. Common errors include:

• Delaying Part B when not covered by creditable insurance

• Overlooking Part D enrollment

• Assuming all providers accept Medicare

• Believing Medicare covers long-term care

The consequences often include:

• Permanent late enrollment penalties

• Denied coverage

• Unexpected bills

Taking time to review your enrollment status, plan choices, and coverage each year—especially during the Annual Enrollment Period (October 15 to December 7)—can protect you from unpleasant surprises.

A Better Medicare Experience Starts With Knowing the Details

Medicare is not a one-time decision. Your needs, income, and health will evolve, and so will your plan choices. Understanding these lesser-known but impactful rules helps you avoid common pitfalls, reduce costs, and ensure continuous coverage.

If you’re approaching age 65, already enrolled, or considering a change, don’t assume you’ve got it all covered. The smallest oversight can result in lasting penalties or missed opportunities.

To get help reviewing your options or to ask questions about your current Medicare status, get in touch with a licensed agent listed on this website. You don’t have to make these decisions alone.