Who’s Eligible for Medicare, and How Do You Enroll?

Medicare is a national group health plan available to U.S. citizens older than 65 who’ve paid Medicare taxes for at least 10 years. Younger Americans diagnosed with Lou Gehrig’s disease or end-stage renal disease are also eligible.

It’s important to know when you become eligible for Medicare benefits so that you can enroll on time. Medicare imposes late-enrollment penalties if you miss your initial enrollment window.

While your income can affect how much you pay for your monthly Medicare premiums, it doesn’t affect your eligibility. You’re still eligible for Medicare even if you have a high income.

Here’s what you need to know about Medicare benefits so you can transition to Medicare as smoothly as possible.

Medicare eligibility requirements

To qualify for Medicare benefits, most people will need to meet the following criteria:^[1]

• You’re 65 or older.

• You’re already receiving Social Security retirement benefits or are eligible to receive them but aren’t yet collecting them.

• You’re a U.S. citizen or a permanent legal resident who’s lived in the U.S. for at least five years.

Most Medicare beneficiaries qualify for benefits based on their work history. Specifically, you (or your spouse) must have at least 10 years of Medicare-covered employment.

Younger Americans can qualify for Medicare due to disability. A diagnosis of one of the following ailments qualifies you for Medicare benefits:

• Any disability that qualifies you for Social Security disability benefits

• End-stage renal disease (permanent kidney failure requiring dialysis or a kidney transplant)

• Lou Gehrig’s disease (also called amyotrophic lateral sclerosis, or ALS)

If you’re diagnosed with Lou Gehrig’s disease, you’ll receive Medicare Parts A and B — also known as Original Medicare — immediately upon enrolling in Social Security disability.

If you have any other disability that qualifies you for Social Security disability benefits, you’ll automatically start receiving Medicare Parts A and B after 24 months on Social Security disability.^[2]

When to enroll in Medicare

It’s important to enroll in Medicare as soon as you’re eligible for the benefit because there’s a late-enrollment penalty.

The initial enrollment period for most people is a seven-month window. It begins three months before the month you turn age 65 and ends three months after you turn 65. This is the best time to enroll in Medicare.

If you miss this enrollment period and don’t have any other health insurance, you’ll have to pay a late-enrollment penalty. The cost is 10% of the premium cost for every year you were eligible but didn’t enroll. This penalty isn’t a one-time fee, either. Instead, it’s added to the monthly premium you pay for the entire time you have the coverage, which means it’s usually a lifetime penalty.^[3]

But if you still have other health insurance coverage when you turn 65, you can avoid the late-enrollment penalty. You may still have coverage if you’re on an employer-sponsored health plan because either you or your spouse are still working. In that case, you may be eligible for a special enrollment period. This is an eight-month window that begins the month the employment or the health plan ends, whichever comes first.

What about automatic enrollment?

Some people will be automatically enrolled in Medicare without having to apply. Automatic enrollment only occurs for the following reasons:

• You’ve reached age 65 and are already receiving your Social Security retirement benefits.

• You’re receiving Social Security disability benefits.

How to enroll in Medicare

If you’re not eligible for automatic enrollment, you’ll need to manually enroll in Medicare. You can do so on the Social Security Administration website or by calling 1 (800) 772-1213.^[4]

When you’re ready to sign up, make sure you have the following information on hand:

• Social Security number

• Date and place of birth

• Start and end dates for your current health insurance

• Valid email address

The parts of Medicare and what they cover

Medicare has several parts, each generally labeled with a different letter. Understanding what each part covers can help you decide which options will work best for your healthcare needs.

Here are the details you need to know about what each part of Medicare covers, how much it costs, and who provides it.

Part A: Hospital insurance

Medicare Part A is a limited health insurance program that only pays for hospital stays. Part A will cover the following situations:

• Inpatient hospital care

• Inpatient care in a skilled nursing facility

• Hospice care

• Some home healthcare

Most people don’t have to pay for Medicare benefits for hospital insurance because they qualify for premium-free Part A. To qualify, you only need to have paid for Medicare through your payroll taxes for at least 10 years under Medicare-covered employment.

Part B: Medical insurance

Medicare Part B is the kind of medical insurance that most people are familiar with. This part of Medicare helps you pay for things like outpatient care, doctor appointments, home healthcare, preventive care, and durable medical equipment (like walkers or wheelchairs). Part B doesn’t cover any prescription drugs.

You’ll pay a monthly premium for Medicare Part B — $174.70 in 2024. Most people on Medicare pay their premium by having it deducted from their monthly Social Security benefits.

Medicare Part B also has an annual deductible of $240 (as of 2024) that you must meet before your Medicare benefits kick in. Once you’ve met the deductible, you’ll pay a 20% co-insurance amount for every Medicare-approved service you receive.

Parts A and B together form what’s known as Original Medicare, and the federal government provides it. Original Medicare is not available through private insurance companies.

Part C: Medicare Advantage

Medicare Part C is an alternative to Original Medicare that allows you to get all your Medicare coverage through a medical insurance provider. A Medicare Advantage plan is a Medicare-approved health insurance plan that bundles Part A, Part B, and usually includes Part D, or prescription drug coverage.

Many beneficiaries choose a Medicare Advantage plan because it has lower out-of-pocket costs than Original Medicare plus Part D, or because it offers benefits that Original Medicare doesn’t, such as vision, dental, and hearing services.^[5]

Generally, if you have a Medicare Advantage plan, you won’t need to also buy a Part D prescription drug plan.

It’s also important to note that you can’t buy a Medicare Advantage plan and a Medigap plan, which helps you afford the out-of-pocket costs of Original Medicare, at the same time. You must choose one or the other.

Part D: Prescription drug coverage

Original Medicare, which includes Parts A and B, doesn’t cover prescription drugs. Medicare Part D is an optional Medicare plan that helps you pay for the cost of prescription drugs.

You can purchase a Medicare prescription drug plan separately as a supplement to your Original Medicare, or you can purchase a Medicare Advantage Plan (Medicare Part C), which includes prescription drug coverage.

Medigap (Plan G or K)

Medigap coverage helps you pay the copayment or co-insurance amounts required for Part A and Part B coverage. You can only qualify for Medigap coverage if you have Original Medicare (aka Medicare Part A and Part B). Medigap is also known as Medicare supplemental plans. Each Medigap policy only covers one person, so spouses each need to buy their own Medigap plan.

You can’t use a Medigap policy with a Medicare Advantage (Part C) policy. You must choose one or the other.

What to know about Medicare costs

Although Medicare is low cost, it’s not entirely free. Here are some potential costs associated with your Medicare plan.

Premiums

Medicare Part A is generally premium-free, as long as you worked for at least 10 years while paying Medicare taxes. If you’re not eligible for premium-free Part A, you’ll pay either $278 or $505 per month in premiums, depending on how long you worked while paying Medicare taxes.

Medicare Part B has a standard premium of $174.70 per month — as of 2024 — for anyone earning less than $103,000 ($206,000 for married couples.) High-earning individuals have to pay a higher premium, depending on how much more they make.

Deductibles

Your deductible is the amount you have to pay for covered services before Medicare payment begins. For Medicare Part A, the 2024 deductible is $1,632. You’ll have to pay this amount before your hospital insurance plan starts paying for your care.

The Part A deductible applies to every benefit period, rather than annually. This means if you go to the hospital three times over the course of a year, you’ll have to meet the $1,632 deductible each time before Medicare payment kicks in.

Medicare Part B has an annual deductible of $240. Once you’ve met that deductible, Medicare will pay for all covered services for the plan year after that point.

Copayments

The copayment, or copay, is a fixed amount you pay for Medicare-covered services. Medicare Part A has specific copays for inpatient hospital stays, depending on the length of your stay.

These copays are:

• 1–60 consecutive days in the hospital: $0 after meeting your Part A deductible

• 61–90 consecutive days in the hospital: $408 each day 

• 91–150 consecutive days in the hospital: $816 each day 

• 151+ consecutive days in the hospital: You pay all costs

Co-insurance

Medicare asks beneficiaries to pay co-insurance for all covered services under Part B. The co-insurance amount is a percentage of the cost of service. Generally, you’ll pay 20% of the cost of covered services after you’ve met the yearly deductible.

Medicare premiums for high-income earners

The 2024 standard monthly Medicare premium is set at $174.70 for any person earning less than $103,000 per year and any married couple earning less than $206,000 per year. People with higher incomes pay higher premiums for their Medicare plans based on their specific income levels. This is called the Income-Related Monthly Adjusted Amount (IRMAA).

The IRMAA sets the additional monthly premium based on the specific modified adjusted gross income bracket of the beneficiary. For 2024, here’s the IRMAA for each modified adjusted gross income level:^[6]

Medicare eligibility FAQs