New Medicare enrollment rules that eliminate coverage gaps take effect in 2023. Here’s what you need to know

For some people, enrolling in Medicare did not translate into immediate coverage.

That’s about to change: Starting next year, the current months-long delays in certain Medicare enrollment situations will be eliminated. In addition, potential beneficiaries who missed their registration when they were supposed to due to “exceptional circumstances” may benefit from a special registration period.

Such delays can mean facing a gap in health insurance – which in turn can mean either not being able to get needed care due to financial constraints, or having to pay for care out of pocket, they are planned or emergency.

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“It’s really about having access to fairly essential health services,” said Casey Schwarz, senior attorney for education and federal policy at the Medicare Rights Center.

Medicare’s enrollment rules can be confusing at best and costly at worst, experts say.

For people who use Social Security before age 65, Medicare enrollment (Part A hospital coverage and Part B outpatient coverage) is automatic when they reach that eligibility age.

Otherwise, you must enroll during your “Initial Enrollment Period” when you reach age 65, unless you meet an exception, such as having eligible health insurance with a large employer (20 or more workers) .

Your initial enrollment period, as it is called, begins three months before your 65th birthday and ends three months after (seven months in total). By law, the start of a Medicare enrollee’s coverage depends on the month that person enrolls. If you enroll before the month you turn 65, coverage begins on the first of the month of your birthday; enroll the month of your birthday and coverage begins the following month.

The new rules eliminate the delay new beneficiaries had to face if they signed up near the end of the seven-month period: signing up a month after reaching age 65 means coverage kicks in 2 months later. Waiting longer than that, but still within that seven-month window, resulted in a three-month delay in coverage.

Starting next year, coverage will start the month after you join.

If you miss your initial registration period and are not eligible for a special registration period, you can generally only register during the first three months of the year during a “general registration period” .

Going this route also meant waiting until July for coverage to take effect. Next year, it will be effective the month following your registration.

However, in this situation, there may still be a late registration penalty. For Part B, it is 10% of the standard premium ($164.90 for 2023) for each 12 month period you should have been enrolled but were not.

Part D (prescription drug coverage) also comes with a late enrollment fee. This is 1% of the “National Base Premium” ($32.74 in 2023) multiplied by the number of months you have been without Part D since your enrollment period (if you had no qualifying coverage instead).

In either case, late registration penalties are usually perpetual.

Starting next year, individuals may be able to register outside of the current registration periods if they have “exceptional circumstances”. That’s flexibility already available with Part D, as well as Medicare Advantage plans (which provide Parts A and B and usually D), Schwarz said.

“It’s really designed to bring relief to people affected by exceptional circumstances and who need access to health insurance,” she said.

In addition, beneficiaries who qualify for the special enrollment period will not be subject to Part B late enrollment penalties.

Until this rule change, the only way to qualify was if a government official provided the wrong information or made a mistake that prevented you from registering.

“There are situations where… people make mistakes,” Schwarz said. “So these rules allow for some flexibility.”

Some eligible circumstances could include an employer providing inaccurate Medicare enrollment information, or they were in a situation where it was impossible or inconvenient to enroll, such as a natural disaster or incarceration.