Enrolling for Medicare Part B While Living Overseas
By Orlando Gotay
You probably know that Medicare is a federal health insurance plan for people who are age 65 or older. Medicare has four parts—A, B, C, and D. Part A is free for insured people and helps pay for inpatient hospital care. Under the vast majority of circumstances, Medicare will not be available to cover medical expenses when living outside the US.
Part B helps pay for doctors’ services and outpatient care. It is “voluntary”—if a person chooses not to enroll when first eligible, the premiums are increased permanently by 10 percent per year based on the number of 12-month periods the person was without coverage.
I recently wrote to the Centers for Medicare and Medicaid Services to find out the rules regarding Part B enrollment in the case of US citizens who reside outside the United States.
Those eligible for premium-free Part A (based on their or their spouse’s work record) are also eligible to sign up for Part B during an initial enrollment period, three months before and after the person turns 65, no matter where the person lives.
If a person does not qualify for premium-free part A and lives overseas, then that person must return to the US to gain eligibility. No penalty applies in those cases.
Those who were eligible to sign up for Part B but did not do so must wait for a future regular enrollment period. This happens every January 1 through March 31 … but remember that the premium will be higher than it would have initially been.
If you still work and are covered by an employer-provided or national health plan (like IMSS) you are able to delay Part B enrollment until you are no longer covered. Since Seguro Popular is not employer based, you may not be able to count on it as a health plan that allows you to delay penalty-free Part B enrollment.
It turns my stomach to pay a premium for coverage that could be useless where one resides. On the low end, it could be over US$1,400 per year, and in my book, that’s quite a few tortillas. Medicare choices are critically important. They mean thousands of dollars of premiums, or the peace of mind of having stateside outpatient coverage. Don’t leave the choice to chance!
Orlando Gotay is a California licensed tax attorney (with a Master of Laws in Taxation) admitted to practice before the IRS, the U.S. Tax Court and other taxing agencies. His love of things Mexican has led him to devote part of his practice to the tax matters of US expats in Mexico. He can be reached at email@example.com.