The Centers for Medicare and Medicaid Services (CMS) is providing relief to certain Medicare beneficiaries enrolled in Medicare Part A and individual coverage bought through a health insurance “exchange” to allow them to enroll in Medicare Part B without penalty through September 30, 2017.
CMS is also offering assistance to individuals who are eligible for Medicare due to disability (but who enrolled in “exchange” coverage instead) and relief via a reduction in the late enrollment penalty to people who missed their initial Part B enrollment window because they mistakenly purchased or were automatically enrolled in individual marketplace coverage.
To ensure that individual beneficiaries are aware that they may be eligible for relief, CMS is emailing notices to people who appear to be Medicare-eligible and to Medicare Part A enrollees who have coverage through the federal health insurance marketplace. Most state-based exchanges are making similar efforts to alert potentially eligible individuals about the availability of the limited penalty relief.
Medicare eligibles who enrolled in other individual coverage sold outside of the marketplace, COBRA, Mini-COBRA, or employer coverage through a group plan with less than 20 eligible employees who do not enroll in Medicare Part B within the designated time frame will still be subject to a late enrollment penalty, and they do not qualify for this special one-time penalty relief. Medicare beneficiaries who do not enroll in Part B right away because they have medical benefits provided through the Veterans Administration are not eligible for this relief either.
Each year, thousands of Medicare-eligible individuals miss their Part B enrollment window and then have to pay a late enrollment penalty for the rest of their lives. Sometimes this happens because the exchange automatically reenrolls a person in individual coverage. However, it usually occurs when a person doesn’t realize that Medicare does not consider certain small group coverage or COBRA or other continuation coverage to be a “creditable” alternative to Part B. Employers with Medicare-age employees and COBRA beneficiaries should inform employees, former employees, and eligible dependents about how Medicare “creditable coverage” rules work.
Those who mistakenly enrolled in or automatically reenrolled into marketplace coverage instead of switching to Medicare Part B during their proper enrollment window should be sure to take advantage of this penalty relief before it expires at the end of September.