27.1 Medicare Overview

Medicare is the federal health insurance program for people 65 and older, certain younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or transplant). Administered by the Centers for Medicare & Medicaid Services (CMS), Medicare provides essential health coverage to over 65 million Americans.

Medicare Eligibility

Age-Based Eligibility (Age 65+)

Disability-Based Eligibility (Under 65)

Key Point: Those with ALS receive Medicare immediately upon receiving their first SSDI payment—no 24-month waiting period required.

The Four Parts of Medicare

Original Medicare vs. Medicare Advantage

Original Medicare (Parts A & B)

Medicare Advantage (Part C)

Medicare Enrollment Periods

Initial Enrollment Period (IEP)

Coverage Start Date by Enrollment Timing

Annual Enrollment Period (AEP)

General Enrollment Period (GEP)

Special Enrollment Period (SEP)

Exam Tip: COBRA and retiree coverage do NOT qualify as creditable employer coverage. If relying on COBRA after leaving employer, you may face late enrollment penalties.

Late Enrollment Penalties

Part A Penalty (If Premium Required)

Part B Penalty

Part D Penalty

Key Point: Part B and Part D late enrollment penalties are usually charged for as long as you have that coverage (for most people, a lifetime penalty). The Part A penalty is different: it lasts twice the number of years you didn't sign up.

Key Takeaways

• Medicare covers people age 65+ and certain disabled individuals or ESRD patients.
• Medicare is divided into Parts A, B, C (Advantage), and D (prescription drugs).
• Initial enrollment begins 3 months before and ends 3 months after age 65.
• General enrollment is Jan 1–Mar 31, and coverage starts the month after you sign up.
• Late enrollment penalties apply when coverage is delayed without credible coverage.
• Coordination with employer coverage depends on employer size and active status.