10 Costly Medicare Mistakes to Avoid at 65

The 10 most expensive turning-65 mistakes we see in Texas — with the real dollar cost and exactly how to avoid each one.

1. 1

   Missing your Initial Enrollment Period (IEP)

   Cost: 10% lifetime Part B penalty per full 12 months you were eligible and didn't enroll

   How to avoid: Enroll at ssa.gov during the 3 months BEFORE your birthday month for coverage effective on the 1st of your birthday month. Book a free planning call if your IEP window is closing.

2. 2

   Skipping Part D because you take no prescriptions

   Cost: 1% of the national base beneficiary premium ($36.78 in 2025, per CMS) per month you went without creditable drug coverage — for life

   How to avoid: Enroll in a low-premium Part D plan even if you take zero prescriptions. Or pick a Medicare Advantage plan that includes Part D. Almost never worth the penalty risk.

3. 3

   Choosing Medicare Advantage without checking your doctors and drugs

   Cost: Surprise out-of-network bills or full-price prescriptions that can run into the thousands

   How to avoid: Before enrolling, verify every doctor is in-network AND every prescription is on the formulary at your preferred pharmacy. We check all of this for you at no cost.

4. 4

   Waiting past your one-time 6-month Medigap Open Enrollment

   Cost: Being medically underwritten and denied coverage — permanently locked out of Medigap in Texas

   How to avoid: Your Medigap Open Enrollment starts the day Part B becomes effective and lasts 6 months. Guaranteed issue. Miss it and every future Medigap application requires health underwriting.

5. 5

   Relying on COBRA instead of enrolling in Part B

   Cost: Lifetime Part B late-enrollment penalty + denied claims (COBRA becomes secondary to Medicare at 65)

   How to avoid: COBRA is NOT considered active employer coverage by Medicare. Your 8-month SEP starts the day active group coverage ends — not when COBRA ends. Enroll in Part B before COBRA starts.

6. 6

   Contributing to an HSA after Medicare (including Part A) takes effect

   Cost: IRS 6% excise tax on excess contributions + back taxes on employer HSA contributions

   How to avoid: Stop HSA contributions 6 months before your Medicare effective date — Part A backdates up to 6 months when you enroll after 65. Existing HSA funds can still pay Part B, D, and Advantage premiums tax-free.

7. 7

   Buying a plan from the first TV commercial or celebrity mailer you see

   Cost: Locked into a plan that doesn't fit — network too narrow, formulary missing your drugs, or wrong tier of Medigap

   How to avoid: Work with an independent Texas agent (not a captive carrier rep) who can shop every major carrier. Same premium, no cost to you — we're paid by the carriers, not you.

8. 8

   Auto-renewing your Medicare Advantage or Part D plan every year

   Cost: Overpaying year after year as plans change formularies, networks, and premiums

   How to avoid: Review your plan every fall during Annual Election Period (Oct 15 – Dec 7). We do free annual reviews for all clients — no obligation to switch.

9. 9

   Assuming Medicare covers long-term care and dental

   Cost: Not covered — the full cost of long-term custodial care falls on you

   How to avoid: Original Medicare doesn't cover long-term custodial care, most dental, hearing aids, or routine vision. Medicare Advantage covers some. Standalone dental, vision, and LTC plans exist — ask us.

10. 10

    Not naming your spouse or family in the decision

    Cost: Wrong plan chosen based on price alone — regret later when a spouse's doctor is out-of-network

    How to avoid: Bring your spouse to the planning call. Medicare is individual coverage, but the decision affects household finances, travel plans, and future retirement moves.

*Some ACA plans in some areas have a small one-time enrollment fee due to little or no broker compensation. Agency enrollment fees never apply to Medicare products.