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Medicare Eligibility Guidelines

Medicare is a government program that was created in 1965 to help America’s seniors get affordable health insurance. It’s a popular entitlement program, “entitlement” referring to the fact that it’s available thanks to taxes. In other words, you’re entitled to it because you spend your working life supporting it via payroll taxes. Of course, it’s not that cut-and-dried. But that’s the basic idea behind the program.

Most people become eligible for Medicare at age 65, but some younger people with disabilities can also enroll. In 2021, over 63 million people are enrolled in the program.

Wondering when you can sign up for Medicare? Here’s what you need to know about Medicare eligibility requirements.

Original Medicare

First, let’s talk about what Original Medicare actually covers. Original Medicare is made up of two parts: Part A (hospital coverage) and Part B (medical coverage).

  • Medicare Part A covers inpatient care, like hospital stays, skilled nursing facility care and psychiatric inpatient services. It also covers hospice.
  • Medicare Part B covers medically necessary outpatient care. This includes a broad range of benefits, such as routine doctor visits, preventive care (e.g., flu shots and cancer screenings), and medical devices, like wheelchairs.

You’ll notice that neither Part A nor Part B covers prescription drugs. Part B will cover a limited set of drugs, such as chemotherapy treatments, but the kind of drugs you get at the pharmacy counter and take yourself — blood pressure pills or insulin, for example — are not covered by Original Medicare.

For these, you would need to add a private plan to your coverage. Your options are a standalone Part D plan, which only covers prescription drugs, or a Medicare Advantage plan with prescription drug coverage.

Medicare eligibility is based on two factors: age and disability.

Eligibility Based on Age

Medicare was originally created for people over the age of 65, making age the most common factor for eligibility. Of the 63 million-plus people enrolled in Medicare in 2021, about 55 million qualify based on age.

You’re eligible for Medicare based on age if:

  • You’re turning 65 soon.
  • You live in the U.S. lawfully (or one of its territories).

You likely also qualify for premium-free Part A if you’ve accumulated enough Social Security work credits (40) during the course of your working life. Remember that Original Medicare is made up of two parts, A and B.

Nearly everyone pays a premium for Part B, but very few people pay a premium for Part A. That’s because payroll taxes help fund Part A. So if you or your spouse (living, deceased or divorced) has accumulated 40 work credits by the time you’re eligible for Medicare, you won’t pay a premium for Part A.

  • Note: You can check the status of your work credits with Social Security directly. It’s actually a good idea to do this before you’re eligible for Medicare, just to make sure your records are correct. Just head over to mySocialSecurity to learn more about creating an account and what you can do with it.

For those who don’t have enough work credits, you can still enroll in Medicare when you turn 65. But you’ll probably have to pay a premium for Part A, which varies each year. How much you pay depends on your work credits.

Eligibility Based on Disability

Not everyone who has Medicare meets the age requirement. In fact, enrollment based on disability accounted for 8.3 million people in 2021. That’s according to the Centers for Medicare and Medicaid Services (CMS), which administers the Medicare program.

Generally speaking, you’re eligible for Medicare based on disability if you qualify for disability benefits from Social Security or the Railroad Retirement Board.

But there are a few things to keep in mind:

  • Medicare enrollment based on disability may be automatic. Once you’ve been getting disability benefits from Social Security or the Railroad Retirement Board for 24 months, you’ll be automatically enrolled into both Part A and Part B on the 25th month of your disability payments.
  • For people with amyotrophic lateral sclerosis (ALS or Lou Gehrig’s disease), Medicare enrollment is automatic and starts the same month you start receiving disability benefits.
  • People with end-stage renal disease (ESRD) qualify for Medicare when they’re diagnosed, even if they aren’t 65. But enrollment is not automatic if you have ESRD. You’ll need to enroll yourself if you want the benefits. To learn more about ESRD qualifications, check out this info from Medicare.gov.

What if I’m still working at age 65?

Medicare eligibility isn’t based on your work status. It’s available to people over the age of 65 and younger people with certain disabilities whether they’re working or not. If you’re still working when you become eligible for Medicare, you have a couple of options:

  • Enroll in Medicare anyway. If you don’t have job-based insurance or another form of coverage, then you may want to enroll in Medicare once you’re eligible since this tends to be a more affordable option for older adults. It might be your only option, too. In fact, it’s actually illegal for someone to sell you a marketplace plan (a private plan under the Affordable Care Act) if you qualify for Medicare. Waiting to enroll could also cause problems later in the form of a Part B late enrollment penalty.
  • Wait to enroll in Medicare. If you have job-based insurance (yours or your spouse’s plan that covers you), then you may be able to wait to sign up for Medicare Part B without paying a late enrollment penalty. You may want to enroll in Part A regardless, though, since most people get this portion for free and it doesn’t hurt to have the coverage in place.

If you’re still working when you turn 65, there may be other things to keep in mind. Contact Social Security directly for more specific guidance about your situation, or check out this page from Medicare.gov.

What if I’m retired but don’t qualify for Medicare?

To reiterate, Medicare eligibility isn’t based on retirement. It’s based on age and/or disability. If you retire early, you’ll still need to wait until age 65 to sign up for Medicare, assuming you don’t qualify based on disability.

If you’re retired and need health insurance but don’t qualify for Medicare, you can explore other options. Those might include:

  • Retiree benefits from your former job
  • Veterans or other military benefits, like TRICARE
  • Medicaid
  • Short-term health insurance
  • Private major medical benefits (Affordable Care Act/”Obamacare” plans)

Major medical benefits are only available during the open enrollment period in the fall, which runs from November 1, 2021 through January 15, 2022 for 2022 coverage. You can enroll in Medicaid (if you qualify) or short term benefits anytime.

Medicare was created to help older Americans get affordable health insurance. Once you’re eligible, you can choose how to get these benefits, whether it’s through Original Medicare with a Part D plan and/or Medicare supplemental plans, or a comprehensive Medicare Advantage plan. Make sure you explore all of your options so that you get the right coverage for your needs.