Medicare Part B: the "B" could stand for "Big."
If Medicare-eligible Americans don't handle Medicare Part B correctly, the result could be another "B," as in, "blunder." An expensive, lifelong blunder.
Medicare Part B is a huge part of the health-care program for older Americans. It features four principal services: outpatient; doctors' visits; home health; and preventive.
A timing mistake in Part B enrollment can be, quite literally, a never-ending financial mistake. The penalty is 10 percent for each 12-month period for which you're not enrolled in Part B. Thus, 12 months would mean a 10 percent penalty, 24 months a 20 percent penalty, and so on. The penalty stays in place as long as you're covered under Medicare Part B, which may mean as long as you live.
In dollars, a typical 2015 premium of $104.90 would increase to more than $115. Also, when the Medicare premium increases, the penalty is added onto the higher premium.
It's a legitimate question to ask why a person would be punished for not signing up for Medicare Part B per the schedule. Here's at least one answer: premiums paid by Medicare beneficiaries help to pay for the plan; therefore, if you're not paying on the front end at the time the government says you're eligible, you'll pay on the back end -- and more -- through the punitive power of penalties.
Medicare does not lack for acronyms, certainly true in terms of Medicare Part B enrollment. There are three enrollment periods: Initial Enrollment Period (IEP); Special Enrollment Period (SEP); and General Enrollment Period (GEP).
You will automatically be enrolled in Medicare Part B (and Part A) if at the time you're age-eligible for Medicare you're receiving Social Security disability or early-retirement payments, or Railroad Retirement Board retirement benefits or disability annuity checks.
If you're not receiving those benefits, you'll have to enroll in Part B. If you enroll late, the late enrollment penalty (LEP) comes into play.
There are time limits to each of the enrollment periods. Generally speaking, the IEP is three months before the month you turn 65, your birth month, and the three following months; SEP enrollment is within eight months after you're no longer covered under another qualifying group plan; the GEP is annually from Jan. 1 through March 31.
Each enrollment component -- IEP; SEP; and GEP -- has its own variables and conditions. Just one example: SEP enrollment timing under Part B depends on your coverage through an employer, when it ends, and other factors. And there are a lot more.
The complexity is why the information offered here is general in nature. The Social Security Administration doesn't send out notices telling you when you're nearing Part B deadlines. The most valuable thing you can do if you're within several years of Medicare-eligible age is to consult with your accountant or financial advisor on the best strategies and decisions to ensure you're getting everything you've earned and not paying a penny more than required.
That's why these decisions are really big. With a capital "B."
You may view the original article from the Knoxville News Sentinel here.
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