Medicare Star Ratings infographic explaining how the 5-star rating system measures plan quality while warning consumers not to choose a Medicare plan based on its star rating alone.

What Is a Medicare Star Rating and Should You Trust It?

Every fall, Medicare plans get rated on a familiar 1-to-5 star scale — the same kind you’d see on a restaurant or a hotel. It’s tempting to read it exactly that way: more stars, nicer experience. But star ratings do something a hotel rating never does — they directly control how many billions of dollars the federal government pays your insurance company. Understanding that connection changes how you should actually use the rating when you’re comparing plans.

What the Rating Officially Measures

The Medicare Star Rating system is run by the Centers for Medicare & Medicaid Services (CMS), and it scores Medicare Advantage and Part D plans from 1 to 5 stars based on dozens of quality measures — things like member experience, preventive care, chronic condition management, and customer service. On paper, it’s a consumer comparison tool, and CMS built it to help people shop with more information than a premium and a brochure.

But that’s only half the story.

The Part Most People Never See: How Stars Set the Money

Here’s the mechanism that actually drives what happens to your plan year over year.

Infographic explaining how Medicare Star Ratings can affect Medicare Advantage plan payments, quality bonus payments, and the flow of additional funding to higher-rated plans.

The 5% Quality Bonus. CMS sets a “benchmark” in every county — the maximum it’s willing to pay a private insurer per Medicare Advantage enrollee. If a plan’s contract rates 4.0 stars or higher, CMS automatically boosts that benchmark by a flat 5%. In 2026, this Quality Bonus Program will pay out $13.4 billion across the industry — more than four times what it cost in 2015. But only about 68% of Medicare Advantage enrollees are currently in a plan that qualifies, down from 75% the year before.

The rebate percentage. When a plan bids below its benchmark, the difference is called “savings,” and the government returns a share of it to the insurer as a rebate — which the insurer is legally required to spend on your benefits, not pocket as pure profit. How much of that rebate a plan keeps depends entirely on its star rating:

Medicare Advantage rebate tier infographic showing how Star Ratings can affect the percentage of Medicare savings returned to plans for additional benefits or reduced member costs.

That gap — 70% vs. 50% — is enormous in dollar terms across a large plan, and it’s the reason star ratings matter so much more to insurers than a simple quality label would suggest.

How This Actually Shows Up in Your Benefits

When a plan’s rebate money shrinks, the plan doesn’t absorb that loss quietly — the change gets passed down to members, usually the following plan year:

  • The out-of-pocket cap can rise. A well-funded 4.5-star plan might set its MOOP well below the federal ceiling — sometimes as low as 3,000-3,500. A plan that loses its bonus funding may push that number up toward the legal maximum, $9,250 in 2026.
  • “$0 premium” plans can add a monthly cost. The bonus pool is a major part of what makes $0-premium plans possible in the first place. Losing that funding can mean a real premium appears where there wasn’t one before.
  • Dental, vision, and hearing allowances shrink first. By law, rebate dollars have to go toward reducing your costs or funding extra, non-Medicare benefits. When the rebate percentage drops, these “extras” are typically the first thing trimmed.
  • Networks can shrink too. To manage costs with less revenue, some carriers narrow their provider networks — which is why a longtime doctor can suddenly become “out-of-network” the following year with no warning that feels connected to anything you did.

Paul’s Honest Take: This is exactly why I tell clients not to treat a plan’s current benefits as a permanent promise. A plan can look fantastic this year and genuinely shrink next year — not because the insurer decided to be less generous, but because a small ratings dip changed how much government money is funding those benefits in the first place. It’s worth checking the star rating every single Annual Enrollment Period, even for a plan you already like.

It’s Gotten Worse: The 2026 Wave of Plan Exits

Everything above used to be a slow, gradual pressure. In the last two years, it’s become something much sharper: insurers are increasingly choosing to exit markets entirely rather than absorb the cost of running a lower-rated plan.

Medicare Advantage forced disenrollment trend chart showing changes in the number of beneficiaries required to find new coverage after plans exited markets or discontinued coverage.

A February 2026 study from the Johns Hopkins Bloomberg School of Public Health and Georgetown University, published in JAMA, found that the forced disenrollment rate — the share of Medicare Advantage members whose plan simply stopped being offered in their county — averaged about 1% a year from 2018 through 2024. In 2025, it jumped to 6.9%. In 2026, it reached 10% — roughly 2.9 million people losing their plan, not by choice, in a single year. That’s a tenfold increase in just two years.

Who gets hit hardest: the study found that people in PPO plans, smaller carriers, lower-rated plans, and rural counties were disproportionately affected. In seven states — Vermont, Idaho, Wyoming, North and South Dakota, Maryland, and New Hampshire — more than 40% of Medicare Advantage enrollees faced this disruption. Vermont was the most extreme case: 92% of the entire state’s Medicare Advantage enrollees had their plan exit the market.

This isn’t only about small players. Humana has publicly said it’s exiting multiple markets for a second consecutive year — an announced move for 2027 affecting roughly 600,000 members — explicitly framed by its own leadership as an effort to “prioritize higher-performing plans.” Smaller carriers have been hit even harder: Clear Spring Health withdrew entirely from Colorado, Georgia, and Illinois, leaving its members there to find new coverage from scratch.

Paul’s Honest Take: What’s happening here is the same mechanism as the star-rating rebate system, just accelerated. When the government reduced how much it overpays Medicare Advantage plans, carriers responded by cutting the plans and regions that were no longer profitable — and that overwhelmingly means lower-rated plans and rural markets. If you’re on a 3 or 3.5-star plan, especially in a rural area or with a smaller carrier, I’d treat this year’s Annual Notice of Change letter as required reading, not junk mail.

If your plan exits, you’re not left without options. You’ll receive a Special Enrollment Period to choose a new Medicare Advantage plan, or move back to Original Medicare — and you cannot be denied or charged more because of a pre-existing condition during that transition. It’s a disruptive process, but not a dangerous one, as long as you act during the window rather than letting it lapse.

This trend isn’t reversing next year, either. CMS finalized changes to the star ratings methodology in 2026 that are projected to send an additional $18.6 billion to insurers over the next decade — but researchers who track this closely don’t expect it to slow the pace of plan exits or benefit cuts for lower-rated plans. The financial pressure pushing carriers toward “profit over enrollment” isn’t a one-year blip; it’s the direction the whole program is heading.

What to Actually Do If You’re Worried About Your Plan

If you’re on a lower-rated plan, in a rural area, or with a smaller or regional carrier, here’s a concrete way to handle it rather than just worrying:

  1. Check your plan’s current star rating now, don’t wait for fall — the Medicare Plan Finder at Medicare.gov shows it directly.
  2. Open your Annual Notice of Change (ANOC) letter the day it arrives. It’s the single clearest signal of what’s changing for your plan next year, and it typically arrives by late September.
  3. If your plan is a PPO with a smaller or regional carrier, treat that combination as a higher-risk profile based on the current data, and have a backup plan researched before Annual Enrollment opens, not after.
  4. If your plan does exit, don’t panic — use your Special Enrollment Period promptly, and know that pre-existing conditions can’t be used against you during that transition.
  5. When in doubt, call and ask directly rather than guessing from a letter alone — a five-minute conversation can confirm whether your specific plan and region are genuinely at risk.

When Do New Ratings Actually Come Out — and What’s Changing?

Star ratings follow a predictable annual rhythm, worth knowing so you’re not caught off guard:

  • August–September: CMS gives carriers a private “Plan Preview” of their preliminary data, so insurers can review their scores and file administrative challenges before anything goes public.
  • Early October: CMS publishes the finalized ratings for the upcoming plan year directly on the Medicare Plan Finder.
  • October 15th: Annual Enrollment opens just days later — deliberately timed so you can see current ratings before choosing or renewing a plan.

One labeling quirk worth understanding: ratings are named for the year the benefits take effect, not the year they’re published. The ratings CMS releases in October 2026 are called the “2027 Star Ratings,” even though they land in your mailbox and on Medicare.gov this fall.

A correction worth being precise about: CMS has finalized a significant methodology overhaul for 2027 — removing 11 measures focused on administrative processes (like appeals handling and complaint volume) and shifting more weight toward clinical outcomes and patient experience. It’s a real, verified change. But the actual rating impact of that overhaul won’t show up until the 2029 Star Ratings, released in October 2028 — not this October. Some industry coverage has blurred that distinction; the measure changes begin affecting data collection in the 2027 measurement year, but the ratings themselves take two more years to reflect it.

Paul’s Honest Take: This is a good example of why it pays to read past the headline on anything Medicare-related. “Massive volatility this October” makes for an attention-grabbing claim, but the actual CMS timeline says otherwise. What I’d genuinely watch for is 2028: that’s when plans lose the administrative-measure “buffer” that’s historically helped some carriers hold onto a decent rating even with real gaps in clinical performance. If a plan has been leaning on strong customer-service scores to offset weaker clinical numbers, 2029 is when that math changes.

Why Insurers Sue the Government Over a Fraction of a Star

Because even a small ratings change can swing tens or hundreds of millions of dollars for a large carrier, insurers fight hard to defend their scores. Companies including Humana and Clover Health have filed legal challenges against CMS, arguing that the underlying scoring methodology — including the specific numeric “cut points” used to translate raw performance data into star levels — is flawed or applied inconsistently.

These challenges aren’t just noise: in 2026, a court ruling in Clover Health’s favor forced CMS to recalculate star ratings across the industry, which retroactively increased bonus eligibility, rebate percentages, and even Special Enrollment Period access for some plans.

Paul’s Honest Take: This is a genuinely strange feature of the system worth understanding: the star rating you see for a plan might not be final in the way it looks. Legal challenges can and do change ratings after the fact — which is one more reason not to treat a star rating as gospel, and to recheck a plan’s current standing rather than relying on what you remember from last year.

The One Genuine Perk: The 5-Star Escape Hatch

There’s a real, practical upside to all this for consumers, and it’s worth knowing whether or not you currently care about star ratings at all.

If a plan earns a perfect 5.0-star rating, CMS grants it a special privilege: a year-round Special Enrollment Period. Normally, you’re limited to switching plans during the fall Annual Enrollment Period (October 15 – December 7) or the Medicare Advantage Open Enrollment Period (January 1 – March 31). But if a qualifying 5-star plan is available in your area, you can switch into it once, any time between December 8 and November 30 of the following year — completely outside the normal enrollment calendar.

In 2026, only 21 contracts nationwide earned a full 5.0-star rating, so this option is genuinely selective and not available everywhere. But if one exists in your area and you’re unhappy with your current plan, it’s a real, underused way out that doesn’t require waiting for fall.

How to Actually Use Star Ratings When Shopping

Given all of this, here’s the honest way to read a star rating:

  • Treat it as a stability index, not a satisfaction score. A 4+ star plan is financially well-supported and more likely to keep its current benefits stable. A sub-3.5-star plan is on shakier financial ground, and its perks are genuinely more vulnerable to cuts next year.
  • Don’t assume a lower-starred plan is bad care. The rating blends dozens of measures at the contract level, not necessarily your specific experience with your specific doctors within that plan.
  • Recheck every year, even for a plan you’re happy with. Ratings and their financial consequences reset annually — what funded your benefits last year isn’t guaranteed to fund them next year.
  • If a 5-star plan exists near you, know you have a standing option, not just during the fall rush.

Frequently Asked Questions

Does a higher star rating mean better doctors or hospitals? Not directly. The rating measures the insurance plan’s overall performance — things like member satisfaction, preventive screening rates, and complaint volume — not the quality of any individual doctor within the network.

Can a plan’s star rating change mid-year? Ratings are generally set annually, but as the Clover Health case shows, a legal challenge can force a retroactive recalculation that changes bonus eligibility and rebate percentage after the fact.

If my plan drops below 4 stars, will my benefits definitely get worse? Not guaranteed, but the financial pressure to reduce benefits increases meaningfully. Some carriers absorb the hit for a year to retain members; many don’t, especially for the non-mandatory “extra” perks.

Where do I actually check a plan’s current star rating? The Medicare Plan Finder at Medicare.gov displays the current rating for every plan available in your area, alongside the specific benefits and costs for that plan year.

When do new star ratings actually come out? CMS releases finalized ratings for the upcoming plan year in early October — typically between October 5th and October 15th — timed deliberately to land just before the Annual Enrollment Period opens on October 15th, so you can see current ratings before you shop or renew.

Confusingly, a “2027 Star Rating” doesn’t mean it comes out in 2027 — does it? Right — ratings are labeled by the year the benefits take effect, not the year they’re published. The “2027 Star Ratings” are actually released in October 2026, ahead of AEP for the 2027 plan year.

Is it worth switching plans purely to chase a higher star rating? Not on its own — a slightly lower-rated plan with your specific doctors in-network is often the better choice than a higher-rated plan that doesn’t include your care team. Use the rating as one input, not the deciding factor.

What happens if my plan exits my market entirely? You’ll get a Special Enrollment Period to choose a new Medicare Advantage plan or return to Original Medicare, and insurers cannot deny you or charge more for pre-existing conditions during that transition. It’s worth acting promptly once you’re notified rather than waiting until close to a deadline.

How do I know if my plan is at risk of exiting or getting cut back? Watch your mail closely every fall for your plan’s Annual Notice of Change (ANOC) — it details exactly what’s changing for the coming year. If your current plan sits at 3 or 3.5 stars, is a PPO, is offered by a smaller carrier, or you’re in a rural area, the recent data suggests you’re in a higher-risk category and it’s worth double-checking your plan’s status even before ANOC arrives.

The Bottom Line

Star ratings aren’t fake, and they’re not meaningless — but they’re doing a very different job than most people assume. Rather than reading them purely as “how good is this plan,” it’s more accurate — and more useful — to read them as “how financially supported is this plan right now, and how likely is it to keep its current benefits.” Check the rating every year, even for a plan you already have, and don’t be afraid to ask directly how a rating change might affect what you’re paying next year.

Related Reading

Sources:

This article reflects 2026 Medicare rules and is for educational purposes. Star ratings and plan benefits change every year — if you’d like help checking how a specific plan’s current rating might affect your coverage, call us at 631-358-5793. No pressure, no cost.



What Is Medicare Part B and What Does It Actually Cover?

The complete guide to Medicare’s medical insurance — every service it covers, exactly what it costs in 2026, how it works with group insurance and VA benefits, and the excess charges most people have never heard of until they get a surprise bill.

The Short Answer

Medicare Part B is medical insurance — it covers doctor visits, outpatient care, preventive services, durable medical equipment, and more. Unlike Part A, Part B is not premium-free for anyone: everyone pays a monthly premium (202.90in2026formostpeople),anannualdeductible(283), and 20% coinsurance on most covered services, with no yearly cap on that 20% under Original Medicare alone. Whether you need to enroll at 65, and whether delaying is safe, depends heavily on your employment status and your employer’s size — getting this wrong is one of the most consequential and permanent mistakes in all of Medicare.

Key Takeaways

  • Part B is never premium-free — everyone pays a monthly premium, and higher earners pay significantly more through IRMAA.
  • The 20% coinsurance under Original Medicare alone has no yearly cap — this is the single biggest financial risk in Medicare, and it’s the reason Medigap and Medicare Advantage exist.
  • Whether you can safely delay Part B without a penalty depends on your employer’s size: 20+ employees generally allows delay; fewer than 20 generally does not.
  • Missing your enrollment window triggers a permanent 10% penalty for every 12-month period you went without coverage.
  • Veterans can and generally should enroll in Part B even with VA benefits, since Medicare and VA coverage don’t coordinate — each only pays for care received within its own system.
  • “Excess charges” from non-participating providers can add up to 15% on top of what Medicare approves, and only some Medigap plans protect you from them.

What Part B Actually Covers

While Part A handles hospital room and board, Part B is the half of Original Medicare that covers medical care and most services delivered outside a hospital admission — doctor visits, outpatient procedures, and ongoing medical needs.

What’s covered

  • Doctor visits — primary care and specialists
  • Outpatient surgeries and procedures
  • Diagnostic lab work, X-rays, and MRIs
  • Emergency room visits
  • Ambulance services
  • Outpatient mental health care
  • Physical, occupational, and speech therapy
  • Chemotherapy and radiation received in an outpatient clinic
  • Durable Medical Equipment (DME) — wheelchairs, oxygen equipment, blood sugar monitors, walkers, and similar equipment
  • Ambulatory surgical center services

Preventive services: the part Medicare gets genuinely right

Most preventive services are covered at 100%, with no deductible and no copay, as long as your provider accepts Medicare assignment. This includes:

  • Your one-time “Welcome to Medicare” wellness visit, available within your first 12 months on Part B
  • Annual wellness visits after that
  • Flu shots and most other recommended vaccines
  • Mammograms
  • Colonoscopies and other cancer screenings
  • Diabetes and cardiovascular screenings
  • Many other screenings recommended by the U.S. Preventive Services Task Force

Paul’s Honest Take: This is one of the most underused parts of Medicare, full stop. I’ve had clients who paid for a private physical every year out of habit and never realized their annual wellness visit through Medicare was completely free. If you haven’t used your Welcome to Medicare visit or your annual wellness visit, that’s real value sitting on the table.

What’s NOT covered

  • Routine dental care — cleanings, fillings, dentures, extractions
  • Routine vision exams and eyeglasses
  • Hearing aids (though diagnostic hearing tests ordered by a doctor may be covered)
  • Long-term custodial nursing home care — help with daily living activities, as opposed to short-term skilled or medical care
  • Routine prescription drugs you pick up at a retail pharmacy — that’s Part D’s job, not Part B’s
  • Cosmetic surgery, unless medically necessary (such as reconstruction after an accident or mastectomy)
  • Most care received outside the United States, with very limited exceptions
  • Routine foot care, such as nail trimming, in the absence of a qualifying medical condition
  • Acupuncture, except for a narrow, specific chronic low back pain benefit
  • Concierge medicine fees and membership-style charges some practices add on top of standard care
  • Long-term care insurance-style services, including most home-based personal care that isn’t tied to a skilled medical need

Paul’s Honest Take: The dental and vision exclusions are the ones that surprise people most, especially since they’re such routine parts of healthcare for most adults. This is exactly why so many Medicare Advantage plans build dental, vision, and hearing benefits into their coverage — Original Medicare was simply never designed to include them, and that gap doesn’t go away on its own.

What Part B Costs in 2026

Part B has three separate cost components, and understanding all three matters:

Cost Component

2026 Amount

Standard monthly premium

$202.90

Annual deductible

$283

Coinsurance on most covered services

20%

The premium is deducted automatically from your Social Security check if you’re already collecting benefits. If you’re not yet collecting Social Security, you’ll receive a bill, typically every three months.

The deductible works differently than Part A’s — it’s a straightforward annual figure. You pay the first $283 of Medicare-approved outpatient costs each calendar year, and then Medicare’s cost-sharing kicks in.

The coinsurance is where the real risk lives. After your deductible is met, Medicare pays 80% of the Medicare-approved amount for most covered services, and you’re responsible for the remaining 20%. There is no yearly cap on this 20% under Original Medicare alone. If you have a $100,000 course of cancer treatment, your 20% share is $20,000 — unless you have a Medigap policy or Medicare Advantage plan absorbing that cost.

Paul’s Honest Take: I put this in bold because it’s genuinely the single most important number in this entire guide. That uncapped 20% is the whole reason Medigap and Medicare Advantage exist as products in the first place. Original Medicare by itself was never designed to protect you from a truly expensive year — it was designed to cover 80% of it and leave the rest to you.

IRMAA: What Higher Earners Actually Pay

If your income is above certain thresholds, you’ll pay more for Part B through the Income-Related Monthly Adjustment Amount (IRMAA) — based on your tax return from two years prior. For 2026, that means your 2024 income determines your premium tier.

2024 Income (Individual)

2024 Income (Married, Joint)

Total Part B / Month

$109,000 or less

$218,000 or less

$202.90

$109,001 – $137,000

$218,001 – $274,000

$284.10

$137,001 – $171,000

$274,001 – $342,000

$405.80

$171,001 – $205,000

$342,001 – $410,000

$527.50

$205,001 – $499,999

$410,001 – $749,999

$649.20

$500,000 and above

$750,000 and above

$689.90

At the top tier, you’re paying more than three times the standard premium. If your income has recently dropped — retirement, the loss of a spouse, or certain other life-changing events — you can appeal your IRMAA determination using Form SSA-44.

Do You Have to Enroll? And What Happens If You Don’t?

Technically, Part B is optional — Medicare won’t force you into it. But opting out without a valid alternative is genuinely risky, because of how the penalty structure works.

If you don’t sign up during your Initial Enrollment Period (the 7-month window around your 65th birthday) and you don’t have qualifying employer coverage, you’ll face a permanent 10% penalty added to your premium for every full 12-month period you went without Part B. That penalty doesn’t expire — you pay it for as long as you have Part B, which for most people means for the rest of your life.

Example: If you delayed enrollment by 24 full months without a valid exception, you’d pay an extra 20% on top of the standard $202.90 premium in 2026 — roughly $40.58 more, every month, permanently.

How Part B Works with Group Insurance

Just like Part A, whether you can safely delay Part B without penalty comes down to one specific number: how many employees your company has.

Companies with 20 or more employees: If you or your spouse are actively working and covered by a genuine group health plan, your workplace insurance is primary, and you can legally delay Part B without any penalty. When that employment or coverage eventually ends, you get an 8-month Special Enrollment Period to enroll in Part B penalty-free.

Companies with fewer than 20 employees: Medicare automatically becomes your primary insurer at 65, regardless of your employment status. You need to enroll in Part B right on schedule. If you don’t, your small employer’s plan can legally refuse to pay claims that Medicare should have covered first — potentially leaving you responsible for the full cost.

Paul’s Honest Take: I say this in nearly every guide I write, because it’s genuinely one of the costliest misunderstandings I encounter: “I have good coverage at work” and “I’m protected from Medicare’s enrollment deadlines” are two completely different statements, and whether the second one is true depends entirely on your employer’s size — not how generous the coverage feels. Confirm the actual employee count before you decide to delay anything.

Retiree Coverage Is Not the Same as Active Employer Coverage

This is a distinction that catches a genuinely large number of people off guard: the “20 or more employees” exception only applies to active employment. If you retire and your former employer offers you retiree health benefits — sometimes a genuinely good, comprehensive plan — that coverage does not create a Special Enrollment Period the way active group coverage does, and it does not exempt you from enrolling in Part B on time.

Paul’s Honest Take: I’ve seen this mistake more than once, and it’s an especially painful one because it happens to people who did everything right during their working years. Someone retires with a strong retiree health plan from a large employer, assumes it works the same way their active coverage did, and delays Part B — only to find out later that retiree coverage was never a valid reason to delay in the first place. The moment you stop actively working, that clock starts, regardless of how good your retiree plan looks on paper. If you’re retiring and keeping employer retiree benefits, treat enrolling in Part B as something to handle right on schedule, not something retiree coverage lets you postpone.

Why You Need Both Part A and Part B for Medigap or Medicare Advantage

Here’s a foundational requirement worth understanding clearly, since it shapes every other coverage decision in Medicare: you must be enrolled in both Part A and Part B before you can buy a Medigap policy or enroll in a Medicare Advantage plan. Neither product exists as a standalone substitute for Original Medicare — both are built specifically to work alongside it.

  • Medigap fills the cost-sharing gaps left by Original Medicare (Parts A and B) — it has nothing to fill in if you’re not enrolled in both parts to begin with.
  • Medicare Advantage legally must provide at least the same coverage as Parts A and B combined, which is only possible because you’re required to be enrolled in both before a Medicare Advantage carrier can enroll you.

Paul’s Honest Take: This surprises people who assume they can somehow “skip” Part B and go straight into a Medicare Advantage plan to avoid the extra premium. It doesn’t work that way — Part B enrollment, and its premium, is a prerequisite either way, whether you end up on Original Medicare with Medigap or on a Medicare Advantage plan. There’s no path through Medicare that avoids the Part B premium once you’re actually using the system.

Does Medicare Work If You’re a Veteran?

Yes — and if you have VA health benefits, understanding how the two systems relate is genuinely important, because they work differently than most people assume.

Medicare and VA benefits do not coordinate. These are two entirely separate systems that each pay only for care received within their own network. Medicare doesn’t pay for care you receive at a VA facility, and VA benefits don’t pay for care you receive from a non-VA doctor or hospital. You, the veteran, choose which system to use each time you seek care.

Here’s the critical point: having VA benefits does not exempt you from Medicare’s enrollment deadlines. VA coverage is not considered a qualifying reason to delay Part B without penalty. If you don’t enroll in Part B during your Initial Enrollment Period and you’re relying solely on VA benefits, you can still trigger the permanent late enrollment penalty.

Why the VA itself recommends enrolling in Medicare anyway:

  • It gives you access to civilian doctors and hospitals outside the VA system
  • VA healthcare funding depends on annual Congressional appropriations, which isn’t guaranteed to remain stable
  • If VA authorizes only part of your needed care at a non-VA facility, Medicare can help cover the rest
  • Having both gives you meaningfully more flexibility and security than relying on either system alone

Paul’s Honest Take: This is one of the most common misconceptions I run into with veterans specifically, and it’s an expensive one to get wrong. Good VA coverage feels like it should be enough, and it might genuinely handle most of your care — but it doesn’t protect you from the Part B enrollment clock the way employer coverage from a large company can. The VA itself actively encourages enrolling in Medicare Parts A and B for exactly this reason. If you have VA benefits and are approaching 65, this is worth a direct conversation before you assume you’re covered.

Veterans who enroll in Part B can also purchase a Medigap policy, which can be particularly valuable if you use non-VA providers regularly — though if you primarily rely on VA facilities for most of your care, the value of an added Medigap policy may be more limited, and worth weighing carefully.

How Long Does It Actually Take to Get Part B Approved?

This is one of the most practical, and most overlooked, pieces of planning — especially if you’re leaving a job after 65 and coordinating your Part B start date around the end of your employer coverage. Applying isn’t instant, and the timeline depends heavily on which enrollment window you’re using.

Enrollment Situation

Typical Processing Time

When Coverage Actually Starts

Initial Enrollment Period (around 65)

2–4 weeks, sometimes up to 6

1st of your birthday month (if applied in the 3 months before) or 1st of the month after you apply (if applied during or after your birthday month)

Special Enrollment Period (leaving employer coverage)

4–8 weeks, sometimes longer

1st of the month after your application is submitted

General Enrollment Period (Jan 1–Mar 31, missed window)

4–6 weeks

1st of the month after you apply

Why the Special Enrollment Period takes longer: applying after leaving employer coverage requires two forms, not one — Form CMS-40B (the actual Part B application) and Form CMS-L564 (Request for Employment Information), which your employer needs to complete to verify you had qualifying coverage. Social Security has to manually review both, which is exactly why this route consistently takes longer than a standard Initial Enrollment Period application.

Paul’s Honest Take: This timeline question comes up constantly with clients who are retiring or leaving a job after 65, and it deserves real attention — not just because of the penalty risk we’ve already covered, but because a slow approval can leave you with an actual gap in coverage if you time it too tightly. My standard advice: start this process at least 2 to 3 months before you need Part B to actually begin, not the week your employer coverage ends. If your former employer is slow to complete their portion of Form CMS-L564, that alone can hold up the entire application — so it’s worth following up with your HR or benefits department directly rather than assuming it’s been submitted.

Practical tips to avoid delays

  • Apply online through SSA.gov whenever possible. It’s consistently the fastest method — mailed or faxed forms are more prone to getting lost or delayed.
  • If you’re on a Special Enrollment Period, submit Form CMS-L564 alongside Form CMS-40B, not separately. They need to arrive together, and one incomplete form can stall the whole application.
  • Expect a short intake lag even with online applications. It can take several business days for an online submission to actually appear on a local Social Security agent’s screen — don’t panic if you call shortly after applying and they say they don’t see it yet.
  • Once approved, you don’t have to wait for your physical card. Your Medicare Beneficiary Identifier typically appears in your online Social Security or Medicare.gov account within a day or two of approval, and you can print a temporary card from there — the physical card generally arrives by mail within about 30 days.

Excess Charges: The Cost Almost Nobody Knows to Ask About

Here’s a detail that surprises even people who’ve been on Medicare for years: not every doctor who accepts Medicare agrees to accept Medicare’s approved amount as full payment.

Providers fall into three categories:

  • Participating providers accept Medicare assignment, meaning they agree to accept the Medicare-approved amount as payment in full. This covers the vast majority of providers — roughly 98% of doctors nationally.
  • Non-participating providers still accept Medicare patients but haven’t agreed to accept the standard rate. They can charge an excess charge of up to 15% above the Medicare-approved amount.
  • Opted-out providers have left the Medicare system entirely and can charge whatever they want under a private contract — Medicare pays nothing at all for care from these providers, except in emergencies.

How excess charges actually work: if the Medicare-approved amount for a service is $300 and you see a non-participating provider, they can legally charge up to an additional $45 (15%) on top, for a total bill of $345 — and that excess amount doesn’t count toward your Part B deductible.

Eight states currently prohibit or limit excess charges entirely: Connecticut, Massachusetts, Minnesota, New York, Ohio, Pennsylvania, Rhode Island, and Vermont. If you live in one of these states, you’re generally shielded from excess charges from providers within your state — though you could still face them if you receive care from a non-participating provider elsewhere.

Paul’s Honest Take: This is exactly why Medigap Plan G matters so much for people who want maximum flexibility. Plan G covers excess charges in full — Plan N does not. If you’re the kind of person who wants the freedom to see any doctor without worrying about billing surprises, that distinction is worth understanding clearly before you pick between the two. And regardless of which plan you choose, it’s always worth asking a new provider directly whether they accept Medicare assignment before your first appointment.

The HSA Rule: Part B Closes the Door Too

If you’re hoping to keep contributing to a Health Savings Account, know this clearly: enrolling in Part B — or any part of Medicare — ends your ability to make new HSA contributions. This isn’t unique to Part B; it applies the moment you enroll in Medicare in any form, including premium-free Part A.

If keeping your HSA active matters to you, the only way to legally delay both Part A and Part B is through qualifying employer coverage — which, as covered above, generally requires an employer with 20 or more employees. And because Part A enrollment can be backdated up to 6 months once you do enroll, it’s smart to stop HSA contributions 6 months before you plan to sign up for Medicare or file for Social Security, whichever comes first.

Frequently Asked Questions

Is there a cap on what I’ll pay for Part B services in a year? Not under Original Medicare alone — the 20% coinsurance has no yearly limit. A Medigap policy or Medicare Advantage plan is what actually caps your exposure.

What happens if I don’t sign up for Part B on time? You’ll generally face a permanent 10% penalty on your premium for every 12-month period you went without coverage, unless you qualify for a Special Enrollment Period through active employer coverage.

Do I need Part B if I have good coverage through a small employer? Almost certainly yes. If your employer has fewer than 20 employees, Medicare becomes your primary insurer at 65 regardless of your job coverage, and not enrolling can leave you exposed to unpaid claims and a lifelong penalty.

Do veterans need Medicare Part B if they have VA benefits? Generally, yes. Medicare and VA benefits don’t coordinate — each only pays for care within its own system — and VA coverage doesn’t exempt you from Medicare’s enrollment deadlines or penalties.

What is a Part B excess charge? An additional charge, up to 15% above the Medicare-approved amount, that a non-participating provider can legally bill you. It doesn’t count toward your deductible, and only Medigap Plan G (among current plans) covers it in full.

Can I keep contributing to my HSA if I enroll in Part B? No. Enrolling in any part of Medicare, including Part B, ends your HSA contribution eligibility going forward.

How long does it take to get approved for Part B? It depends on the enrollment window. Initial Enrollment Period applications typically process in 2–4 weeks. Special Enrollment Period applications, used when leaving employer coverage, generally take 4–8 weeks since Social Security must manually verify your prior coverage using Form CMS-L564. Start the process at least 2–3 months before you need coverage to begin, especially when coordinating around a job ending.

The Bottom Line

Part B is the half of Medicare that covers your everyday medical care — and it’s also where the real financial exposure of Original Medicare lives, thanks to that uncapped 20% coinsurance. Whether you should enroll at 65, whether you can safely delay, and how much of that exposure you’re carrying all depend on details specific to your situation: your employer’s size, your income, your VA status, and which doctors you actually see.

If you want help sorting out exactly how Part B applies to your specific circumstances — or want to understand how Medigap or Medicare Advantage could close that uncapped coinsurance gap — that’s exactly the conversation I have with clients every day, at no cost to you.

Call 631-358-5793 or visit paulbinsurance.com to set up a time to talk it through.

Paul Barrett, CMIP, is the founder of The Modern Medicare Agency, based in Melville, NY, and has spent 18+ years exclusively helping people navigate Medicare — never life insurance, never annuities, just Medicare. He’s licensed in 37 states, represents more than 40 carriers, and has personally helped over 5,000 clients choose coverage that actually fits their lives.

Figures current as of 2026 and sourced from CMS, Medicare.gov, and the Social Security Administration. Individual circumstances vary, especially around employer coverage, VA benefits, and income-based premiums — always verify your specific situation before making enrollment decisions.

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