A person may decide to disenroll from Medicare Part B for various reasons. Medicare allows people to reenroll in Part B if they want to, although there may be penalties.
This article looks at Medicare Part B, and the reason a person might no longer be enrolled. It also discusses the process to follow to reenroll. Finally, it explains enrollment periods, penalties, and premiums.
We may use a few terms in this piece that can be helpful to understand when selecting the best insurance plan:
- Deductible: This is an annual amount that a person must spend out of pocket within a certain time period before an insurer starts to fund their treatments.
- Coinsurance: This is a percentage of a treatment cost that a person will need to self-fund. For Medicare Part B, this comes to 20%.
- Copayment: This is a fixed dollar amount that an insured person pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
Medicare Part B, which is medical insurance, is part of original Medicare. Generally, people are first eligible for Medicare Part B when they turn 65 years old, unless they have other qualifying conditions.
Part B covers medically necessary services and supplies, such as:
- outpatient care and emergency room visits
- preventive services including tests and screenings
- ambulance transport
- durable medical equipment (DME) such as crutches and wheelchairs
- mental health services
Medicare extends both Medicare Part A and Part B benefits to people who are:
- aged 65 or older
- disabled and receiving Social Security Income (SSI) or Railroad Retirement Board (RRB) benefits
- diagnosed with end stage renal disease (ESRD)
- diagnosed with amyotrophic lateral sclerosis (ALS)
A person can use this online tool to find out if their service, item, or test is covered.
Medicare may disenroll a person for non-payment of premiums. A person may also disenroll themselves by leaving the plan voluntarily.
Because adequate healthcare coverage is important, the State Health Insurance Assistance (SHIP) program can help a person make informed decisions about Medicare coverage, including looking at different options to Part B.
Missed premiums
Medicare can disenroll an individual from Part B if they do not pay the monthly premiums. However, Medicare provides up to a 3-month grace period to allow someone to pay the overdue premiums.
Grace period
Medicare beneficiaries must pay Part B premiums on or before the 25th day of the month after the date of the initial bill.
For example, if a person gets an initial bill on July 28th, payment is due by August 25th. If a person does not pay by that date, they will receive a second bill from Medicare, requesting payment by the 25th day of the following month, which in this example is September 25th.
If Medicare does not receive payment after the second bill, the beneficiary receives a delinquency notice, demanding the total by the 25th day of the following month, which in this example is October 25th.
If a person does not pay following the 3-month grace period, they will get a termination notice stating they no longer have Medicare coverage.
However, if a person pays their missed premiums within 30 days of the termination notice, they will continue to receive Part B coverage. Otherwise, Medicare discontinues their coverage.
If a person’s coverage is discontinued, they must reenroll in Part B during the Medicare general enrollment period from January 1 to March 31.
Medicare good cause policy
If a person feels they have a good reason or cause for not paying their premiums, they can ask Medicare for reinstatement under the Medicare good cause policy.
The individual must be able to prove the reason for missing payments. Acceptable reasons typically include hospitalization, serious illness, the recent death of a spouse or close family member, or a house fire.
People will still need to pay the full amount for the premiums they owe within a specific time limit for Medicare to resume their coverage.
Alternative healthcare coverage
An employer may provide an alternative healthcare insurance plan for their employee. The coverage may also extend to their spouses.
If the employer insurance ends, Medicare provides a special enrollment period (SEP) to allow people to enroll in Part B. There are several different times when a person can sign up, such as while they are still in the group health plan, and during the first month after they are no longer covered by the plan or when the person stops working, whichever event happens first.
Coverage will begin either on the first day of the month a person enrolls, or any time within the following 3 months, as the person chooses. In this case, coverage will begin on the first day of the month of their choice.
However, if a person chooses to enroll at any other time during the 8-month SEP, their coverage will start the month after they enrolled.
An individual who wants to reenroll in Medicare Part B may have to pay a late enrollment penalty. Generally, the penalty cost is linked to the length of the gap in coverage.
The monthly premium also increases by 10% for each 12-month period an individual was eligible for, but did not have, Part B.
Advice is available from the SHIP about reenrolling in Part B and about penalties.
To reenroll in Medicare Part B, people need to complete an application form on the Social Security Administration website.
The application process requires supporting documentation. The exact documents required depends on an individual’s circumstances, such as if a person enrolled in an employer’s healthcare insurance plan.
Besides the initial enrollment period (IEP), Medicare provides two standard opportunities each year for beneficiaries to reenroll in Part B or change their Medicare coverage.
In some cases, a person may not have to pay late enrollment fees, as they can enroll during a special enrollment period (SEP).
Medicare General Enrollment Period
January 1 to March 31 is the Medicare general enrollment period (GEP).
People can join or reenroll in Medicare parts A and B for coverage to begin on July 1.
People with an advantage plan can also switch between plans or join original Medicare.
Medicare annual open enrollment period
October 15 to December 7 is the Medicare open enrollment period (OEP).
During this time, people can switch from a Medicare Advantage plan back to original Medicare or vice-versa.
People can also change Medicare Advantage plans and add, drop, or switch Medicare Part D (prescription drug) plans. Coverage starts January 1 of the following year.
Exceptions
Medicare allows exceptions for significant life events, such as divorce, and offers special enrollment periods (SEPs).
Qualifying individuals can reenroll in original Medicare or change their Medicare coverage during a SEP.
In addition, a person may be able to enroll at other times if they have been unable to do so because of issues related to Covid-19.
The Social Security Act sets out the Medicare premiums, deductibles, and copays each year.
An individual’s income determines what they will pay for their Medicare Part B monthly premium. For individuals with an income below $88,000, the standard premium is $148.50 in 2021, with an annual deductible of $203.
According to the Centers for Medicare and Medicaid Services, about 7% of Medicare Part B beneficiaries will pay a higher income adjusted premium.
People who receive Medicare benefits can decide to disenroll from their Medicare Part B plan or may be disenrolled for non-payment of premiums.
Medicare allows a person to reenroll in a plan, but they may have to pay a late enrollment penalty fee and provide proof of other coverage.
Because it is essential to have adequate healthcare coverage, people should fully understand the risks and benefits of changing their health insurance. Medicare provides a free, unbiased advisory service through the SHIP program to help people make informed decisions about Medicare coverage.