by Barbara Nevins Taylor.

A friend recently turned 65, lost his job, but kept insurance under Cobra. He wondered whether he should also take Medicare Part B. 

The answer is don’t fool around with this. Take Medicare Part B and avoid costly mistakes. You have eight months after your employment ends to sign up for Part B and you can have both Medicare and Cobra, if you can afford the monthly payments. Medicare becomes your primary insurer, Cobra your secondary.

Many Baby Boomers make a mistake when they don’t take Part B, and then face  big consequences because they didn’t do it when they turned 65.

If you are notworking, there are penalties when you don’t sign up shortly after your 65th birthday.

Joe Baker of the Medicare Rights Center says, “If you don’t enroll in Medicare when you turn 65, the month of your 65th birthday or three months after your 65th birthday, you have two penalties.

TWO PENALTIES Waiting Period

There’s a waiting period penalty that doesn’t allow you join Medicare Part B right away. If you don’t enroll when you are first eligible you have to wait for January or March of that calendar year and your coverage won’t begin until July 1st.  

That means you are uncovered. You don’t have Medicare, and the insurance that you do have is secondary and the insurer is likely to turn down your claims because Medicare should be the primary insurance.

Financial Penalty

There is also a 10 percent monetary penalty for every year that you could have, or should have, signed up for Part B. Baker offers the example of someone who should have signed up in April 2010, but didn’t.

“The person realizes the mistake in October 2013, but has to wait until January of 2014 to sign up for coverage that will begin in July of 2014. They then have to pay a 20 percent penalty because it’s two years from the time they should have signed on,” Baker explained.

“For the rest of that person’s life they will pay 20 percent more than what everyone else pays for Part B,” he said.

No Getting Around It

The penalties are rigid and they are put in place because the folks who designed this system want younger, healthier people who don’t use a lot of medical services to sign up when they are well, so that their premiums help pay the costs for those who are older and sicker.

Baker says, “I don’t think it’s a good idea for anyone to delay Part B enrollment.

The only people who should be delaying Part B are people who are actively at work and have coverage.”

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