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Why Words Matter by John Parker, RHU, LTCP

October 06, 2020
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There are many acronyms and words that may be similar but have particular meanings. For the uninitiated, it can be daunting, particularly in Medicare.

Social Security sets eligibility rules for Medicare in cooperation with CMS so when someone decides to sign up, it’s actually Social Security, not Medicare that processes their application.

Two words that are often confused or used interchangeably are eligible and entitled.

Let’s take the first one, eligible. The rules say it’s the month a person is 65 and the earliest they can sign up. If they decide to apply, there are just seven months, called the Initial Eligibility Period, to complete an application. Their eligible month is in the middle and they can sign up in any of these months.

What are the "When can I?" and "When does it start?" rules? Many questions are asked about this because people are confused by what they find online.

Let’s look at what SS tells us — if a person completes an application:

  • in any month before eligible both Part A & Part B, start the first day of their eligible month.
    Note: When a person’s birthday is the 1st, they are eligible the previous month.
  • during eligible month or in any month after.
    • Part A will be effective the first day of their eligible month no matter when apply.
    • Part B’s date will be different! Why? It’s based on when a person applies using these rules. Part B is effective the first of the:
  • next month if sign up in the month when 65.
  • second month after if sign up in the month after 65.
  • third month after if sign up in the second or third month after 65.

Let’s look at signing up the last Initial Enrollment Period month. If it’s used, Part B will be six months after Part A. Social Security then applies this A is back six months rule to everyone who signs up more than six months after eligible!

Note: Going back six months means a person with an HSA and working after 65 has to stop contributions six months before leaving employment and starting Part B.

These IEP effective dates can be complex and are inconsistent with what is used in other situations.

The second word is entitled. This is what Medicare calls everyone who completes their application. Entitled is thus the date a person begins:
+ Part A for inpatient hospital services.
+ Part B for medically necessary outpatient services.

You may have noticed that entitled is on a person’s Medicare ID card located above Part A and Part B to show when coverage started.