Turning 65? How to Set Up Medicare (Without Lifetime Penalties)

A Medicare card might arrive automatically… or nothing shows up at all. If you’re not sure which bucket you’re in, it’s dangerously easy to miss your enrollment window and rack up lifetime penalties. This guide walks you through exactly what to check and what to do— so you start Medicare on time and on your terms.

• No Social Security check yet = no automatic enrollment. If you’re not receiving benefits ≥4 months before your 65th birthday, you must enroll yourself.
• Your Initial Enrollment Period (IEP) is 7 months. The safest move is to enroll during the 3 months before your birthday month to avoid delayed coverage.
• Working past 65? With creditable employer coverage (generally 20+ employees), you can delay Part B—but don’t enroll in Part A if you want to keep contributing to an HSA.
• COBRA ≠ active employer coverage. It usually doesn’t protect you from Part B penalties; drug coverage under COBRA may or may not be “creditable.”
• Penalties stick for life. Part B: +10% for each full year late without creditable coverage. Part D: +1% of the base premium for each month late without creditable drug coverage.

1. Are you automatically enrolled?

You’re auto-enrolled in Original Medicare (Part A & Part B) only if you’ve been receiving Social Security or Railroad Retirement benefits for ≥4 months before your 65th birthday.

• If yes: Your red-white-and-blue card should arrive ~3 months before your birthday month. Coverage begins the 1st of your birthday month (the month prior if you were born on the 1st).
• If no: Enroll yourself through Social Security. If your card isn’t in hand by ~3 months before your birthday month, assume you need to take action.

2. Know your Initial Enrollment Period (IEP)

Your IEP = 3 months before your birthday month + your birthday month + 3 months after.

• Enrolling during the 3 months before your birthday month helps ensure a smooth start date.
• Enrolling in or after your birthday month can delay your coverage.

3. Still working at 65 (or covered by a working spouse)?

If you’re still working at 65, you may be able to delay Part B without penalty if you have creditable employer coverage (generally from an employer with 20+ employees).

• Many still take Part A if premium-free, but skip Part A if you want to keep contributing to an HSA.
• When that employer coverage ends, you get an 8-month Special Enrollment Period (SEP) for Part B.

4. Don’t get tripped up by drug coverage timing

After losing creditable drug coverage, you have 63 days to get a Part D plan (or an MA-PD). Miss it, and Part D adds a lifetime penalty (calculated monthly) to your premium.

5. COBRA and Medicare (the common mistake)

COBRA usually doesn’t count as active employer coverage for Part B timing. You can be unknowingly late and accumulating penalties.

• Ask your plan in writing whether your medical and drug coverage are creditable for Medicare.
• If not creditable, enroll in Medicare immediately (and add Part D within 63 days).

6. Avoid lifetime penalties (how they’re applied)

Part B: +10% of the Part B premium for each full 12-month period you delayed without creditable coverage—for life.

Part D: +1% of the national base premium for each month without creditable drug coverage after eligibility—for life (the base changes over time).

7. Choose your coverage path

Once A & B are set, pick one of three routes:

• Original Medicare (A & B) + Part D (bare-bones: lowest premium, no cap on medical out-of-pocket).
• Original Medicare (A & B) + Medigap + Part D (higher premium, broader access, more predictable costs).
• Medicare Advantage (Part C/MA-PD) (often low premiums, includes drug coverage; networks & rules apply; watch authorizations and MOOP).

Fit > Price: Choose by doctors, meds, travel, risk tolerance—and how much you value predictable costs and fewer rules.

☐ Receiving Social Security ≥4 months pre-65? Expect card ~3 months pre-birthday.

☐ Not receiving Social Security? Enroll yourself during the 3 months before your birthday month.

☐ Working past 65 with 20+ employee coverage? Confirm creditable medical/drug coverage (in writing).

☐ Contributing to an HSA? Do not enroll in Part A yet.

☐ Coverage ending? Start Part B SEP (8 months); add Part D within 63 days.

☐ Pick your path: A&B+Part D, A&B+Medigap+Part D, or MA-PD.

☐ Document everything (letters, forms, proof of creditable coverage).