Ron Elledge is a seasoned Medicare consultant and author of “Medicare Made Easy.” As a Medicare expert, he regularly consults beneficiaries on Medicare rules, regulations, and strategies.
Medicare is not a straightforward or a simple process to understand in many aspects of its regulations. Although eligibility is quite clear at first sight, it has so many underlying nuances that allow one to easily miss important details. Gaining clarity and understanding will help you get the most out of this program.
Before we list the eligibility requirements for Medicare, let me illustrate the importance of understanding its requirements and benefits.
This story of Richard and Sandra is hypothetical and is not based on actual people or circumstances.
Sandra is turning 65 in six months and is just now investigating Medicare. From her research, she has concluded she will not qualify.
Sandra was a high school athlete and attended five years of college on scholarships and never had time to work even a part-time job. When Sandra entered the workforce at the age of 25, she met the love of her life, Richard, and was married at 27.
When Sandra was 29 years old, Richard was in a major accident which left him a paraplegic for life. Fortunately, Richard’s family was able to help them out financially and, for the next 35 years, they supplemented Richard’s disability income. Richard and Sandra had two children, and Sandra was able to be a stay-at-home mother and a caregiver to Richard.
Now, at age 64, Sandra finds she is far short of the quarters of work required to qualify for Medicare. Panic is setting in as she is looking at difficult medical decisions in her future and soaring healthcare and insurance costs.
However, upon further investigation, it was discovered that even though Richard had not worked since he was 27 years old, he had worked two years while in high school, all through college, and until his car accident. By entering the workforce at age 16 and staying employed until he was 27 years old, Richard had accumulated the 42 quarters of work history necessary to qualify for Medicare. Because Sandra and Richard had been married for over one year, Sandra was able to qualify for Medicare based on Richard being a qualified beneficiary.
The vast circumstances which can have an impact on individual Medicare qualifications require a thorough research and review for those who do not fit the cookie cutter qualifications.
Part A Medicare Enrollment:
Automatic Enrollment: Individuals already receiving Social Security or Railroad Retirement Board (RRB) benefits at least four months before being eligible, who reside in the United States (except residents of Puerto Rico), are automatically enrolled in both premium-free Medicare Part A and Part B. People living in Puerto Rico who are eligible for automatic enrollment are only enrolled in premium-free Part A. This can be a problem for individuals who are enrolled in a Health Savings Account (HSA). You cannot contribute to an HSA once you are on any Part of Medicare.
Manual Enrollment: Individuals who are not receiving a Social Security or RRB benefit are not automatically enrolled. These individuals must apply by contacting Social Security. I suggest they call three months before their eligibility date.
Who receives premium-free Part A free and who must Pay for Medicare Part A
To be eligible for premium-free Part A, an individual must be entitled to receive Medicare based on their own earnings or those of a spouse, parent, or child. To receive premium-free Part A, the worker must have a qualifying number of quarters of coverage earned through payment of payroll taxes under the FICA during their working years. The exact number of quarters required is dependent on whether the person is filing for Part A based on age, disability, or End Stage Renal Disease (ESRD). The general rule for those qualifying based on age 65 is 40 quarters of work during their own or their spouse’s lifetime.
If you are not eligible for premium-free Part A based on 40+ tax quarters, you may purchase Part A with the following monthly premiums. If you paid Medicare taxes for less than 30 quarters, the standard Part A monthly premium is $478 for 2021. If you paid Medicare taxes for 30-39 quarters, the standard Part A monthly premium is $240 for 2021. Other eligibility requirements still apply.
The eligibility rules for Part B depend on whether a person is eligible for premium-free Part A or whether the individual must pay a premium for Part A coverage.
Individuals who are eligible for premium-free Part A are also eligible to enroll in Part B once they are entitled to Part A. Enrollment in Part B can only happen at certain times.
Individuals who must pay a premium for Part A must meet certain requirements to enroll in Part B. You must be age 65 or older. If you qualify for premium-free Part A, residency is not a requirement. However, if you do not qualify for premium-free Part A you must be a U.S. resident and be either a U.S. citizen OR be a resident alien who has been lawfully admitted for permanent residence and has been residing in the United States for 5 continuous years prior to the month of application. You may enroll in Part B without purchasing Part A.
In general, you are eligible for Medicare Part A at no cost if:
- You are age 65 or older and a U.S. citizen or permanent legal resident for at least five consecutive years immediately prior to applying for Medicare.
- You are disabled and receiving disability benefits. Medicare is automatic after you have been on Social Security disability for 24 months.
- You are already receiving retirement benefits from Social Security or Railroad Retirement Benefits.
- You were a state or local government employee after March 31, 1986, or a federal employee any time after December 31, 1982.
- You have end-stage renal disease (ESRD) or Lou Gehrig’s disease (ALS), at any age.
- You have been married to a qualified beneficiary for at least one year before applying. (Richard and Sandra)
- You are divorced from a qualified beneficiary whom you were married to for a minimum of 10 years, and you are single at the time of application. The marital status of the ex-spouse is of no consequence.
- You are widowed by a qualified beneficiary to whom you were married for at least nine months before their death, and you are single at the time of application.
For those under the age of 65 at the time of enrollment, eligibility is based on personal disability.
Before age 65, you are eligible for Medicare Part A at no cost if one of the following applies:
- You’ve been entitled to Social Security disability benefits for 24 months. Medicare begins the 25th month of disability.
- You receive a disability pension from the RRB and meet certain conditions.
- You receive Social Security disability benefits because you have Lou Gehrig’s disease (amyotrophic lateral sclerosis).
- You worked long enough in a government job through which you paid Medicare taxes, and you have met the requirements of the Social Security disability program for 24 months.
- You’re the child or widow(er) age 50 or older, including a divorced widow(er), of a worker who has worked long enough under Social Security or in a Medicare-covered government job, and you meet the requirements of the Social Security disability program.
- You have permanent kidney failure (end-stage renal disease) and you receive maintenance dialysis or a kidney transplant and one of the following applies: —You’re eligible for or receive monthly benefits under Social Security or the railroad retirement system. —You’ve worked long enough in a Medicare-covered government job. —You’re the child or spouse (including a divorced spouse) of a worker (living or deceased) who has worked long enough under Social Security or in a Medicare-covered government job.
Medicare Supplement, Medicare Advantage, and Medicare Prescription Drug Plan (PDP) enrollment:
Supplement (Medigap) Plans and Medicare Advantage Plans require that you maintain enrollment in both Part A and Part B to qualify. A Prescription Drug Plan (PDP), also known as Medicare Part D, can be obtained as a Stand-Alone (PDP) Plan or included in a Medicare Advantage (MA-PD) Plan. For the stand-alone PDP Plans you are required to be eligible for Part A and/or enrolled in Part B. However, Medicare Advantage Plans with prescription drug coverage (MA-PD Plans) require that both Parts A and B remain active. Further discussion of this topic can be found in the article: Medicare Enrollment: Who, When, and How to Enroll.