Millions of older Americans depend on Medicare for their healthcare coverage. If you’re planning to retire this year, you might be getting ready to enroll as well.

Understanding how Medicare operates is crucial. Here are some important facts about Medicare to consider as you approach retirement.

1. You Usually Can’t Enroll Until You Turn 65

You might think that because you can start receiving Social Security benefits at 62, you can also enroll in Medicare at that age. However, Medicare coverage typically starts at age 65, with some exceptions for individuals with specific health issues. Therefore, if you’re looking to retire at 62 and plan to enroll in both Social Security and Medicare, reconsider your strategy.

2. You Don’t Need to Enroll in Both Parts A and B

At age 65, many individuals enroll in both Medicare Parts A and B. Part A mainly covers hospital stays, while Part B covers outpatient services.

A significant difference is that most people do not pay a monthly premium for Part A, whereas Part B does require one. Because of this, if you have the option to maintain coverage through a group health plan, you might choose to enroll in Part A only when you turn 65.

For instance, if you’re retiring this year but still have group health coverage from your spouse’s job, which will continue, you can opt for Part A. This allows it to act as secondary insurance, helping you avoid unnecessary costs associated with Part B.

3. Don’t Delay Enrollment if You’re Losing Your Group Health Coverage

If you have insurance through a qualifying group plan (generally meaning one with 20 or more employees), it’s often wise to postpone enrolling in Medicare Part B unless you’re unhappy with your current employer coverage. However, if you’re retiring and will be losing this coverage and you’re eligible for Medicare, it’s essential to sign up within the seven-month initial enrollment period surrounding your 65th birthday.

If you miss this window, you may face hefty penalties for late enrollment, which could affect you throughout your retirement. Thus, if you won’t qualify for a special enrollment period, make sure to register during your initial enrollment phase.

4. Consider Medigap if You Choose Original Medicare

Those enrolled in Medicare can either stick with Parts A and B along with a Part D drug plan or choose a Medicare Advantage plan for more comprehensive coverage. If you decide to go with the traditional Medicare route, you should strongly consider signing up for Medigap (supplemental insurance) as well. This will prevent you from incurring significant out-of-pocket expenses under original Medicare.

You can apply for Medigap during the month you turn 65 and enroll in Medicare Part B. During this timeframe, insurers cannot deny you coverage based on pre-existing conditions, and you are more likely to receive the best premiums available.

These highlights are just a portion of the essentials regarding Medicare that you should be aware of as retirement approaches. If you’re finishing your working years this year, take time to educate yourself about Medicare to ensure you’re fully prepared.

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