The Cost Equation: Will Medicare Save You Money
If your employer requires you to pay a large portion of the premium on your group health insurance, you may find Medicare cheaper and the coverage adequate. So compare your current coverage and out-of-pocket expenses including premiums, deductibles, copays and coinsurance with your costs and benefits under Medicare, which may also pay some expenses not covered by your group plan.
Getting Medicare Under The Age Of 65
Many people think of Medicare as a government health-care program for Americans and legal permanent residents who are at least 65 years old. But some people qualify for Medicare before age 65.
Here are the most common ways you may be eligible for Medicare if youre under age 65:
- You receive disability benefits from the Social Security Administration or from the Railroad Retirement Board . Youre automatically enrolled in Original Medicare, Part A and Part B, after 24 continuous months of receiving disability benefits.
- You have Lou Gehrigs disease . Youre automatically enrolled in Medicare the same month that your disability benefits start.
- You have end-stage renal disease . In this case, you may qualify for Medicare, but youre not automatically enrolled. To enroll, contact Social Security .
If you have questions about your eligibility for Medicare if youre under 65, or to enroll, you can contact Social Security at 1-800-772-1213. TTY users can call 1-800-325-0778. Representatives are available Monday through Friday, from 7AM to 7PM. Or, you can contact Medicare, or a licensed insurance agent at eHealth .
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Becoming eligible for Medicare can be daunting. But dont worry, were here to help you understand Medicare in 15 minutes or less.
Im Working Past 65 But My Health Coverage Is From My Spouses Employer
A pretty common situation to face, if your health care coverage is from a spouses employer, you may be able to delay Medicare or you may need to enroll when you first become eligible. In this case, the employer still needs to have 20 or more employees. However, the big difference is that employers can have rules for covered dependents 65 and older that may require the individual to get Medicare at 65 in order to remain on the employer plan.
Therefore, if you have employer coverage through a spouses employer, you need to ask the employers benefits administrator directly about your Medicare enrollment choices.
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Choosing My Type Of Medicare Coverage
Your first decision when it comes to health coverage after 65 is between Original Medicare and Medicare Part C.
Original Medicare covers most hospital and doctor expenses. The balance is left to you, with no cap on how high your out-of-pocket costs can go.
Original Medicare allows you to see any doctor in the U.S. who accepts Medicare. It provides excellent flexibility: it has no networks or referral requirements.
Medicare Part C bundles hospital, doctor and drug coverage. It covers most of those expenses, but you pay deductibles, copayments, and coinsurance. Medicare Advantage plans cap out-of-pocket expenses.
Medicare Advantage is all-encompassing, even offering dental and vision coverage . But, you are limited to its doctor network and need referrals to see specialists.
Why You May Consider Signing Up For Medicare At 65
If youre approaching age 65 and are not going to keep working, you have employer coverage from an employer with fewer than 20 employees, or your spouses employer requires you to get Medicare to stay on their health plan, then you need to enroll during whats known as your Medicare Initial Enrollment Period . If you dont, youll likely face financial premium penalties for enrolling late.
Your IEP is a 7-month window that generally includes the month of your 65th birthday, the 3 months before and the 3 months after For example, if your 65th birthday is on June 20, then your IEP starts on March 1 and ends on September 30.
This is the time to learn about your Medicare coverage options and get what you do or dont need coverage for. Most who have to get Medicare at age 65 will get Part A , Part B and some form of prescription drug coverage through either a stand-alone Part D plan or a Medicare Advantage plan.
Depending on your situation such as if you still have or want to keep employer coverage you may not need every part of Medicare available. But keep in mind here a simple rule: If you are not eligible for a Medicare Special Enrollment Period you need to get Parts A, B and D when youre first eligible to avoid financial penalties. Also, if youre still working, its a good idea to check with your employer plan benefits administrator to see how Medicare might work with that coverage before making any final decisions.
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Should I Sign Up For Medical Insurance
With our online application, you can sign up for Medicare Part A and Part B . Because you must pay a premium for Part B coverage, you can turn it down.
If youre eligible at age 65, your initial enrollment period begins three months before your 65th birthday, includes the month you turn age 65, and ends three months after that birthday.
If you choose not to enroll in Medicare Part B and then decide to do so later, your coverage could be delayed and you may have to pay a higher monthly premium for as long as you have Part B. Your monthly premium will go up 10 percent for each 12-month period you were eligible for Part B, but didnt sign up for it, unless you qualify for a “” .
If you dont enroll in Medicare Part B during your initial enrollment period, you have another chance each year to sign up during a general enrollment period from January 1 through March 31. Your coverage begins on July 1 of the year you enroll. Read our publication for more information.
How Rich Is Your Employer Group Health Coverage
Is it great, the best insurance youve ever had? Well good for you! You can rest easy knowing that you are covered well and dont need Medicare yet.
Is your insurance anything less than stellar? Then you might want to think about having Medicare in addition to your group health plan.
As we mentioned, when you work for an employer with 20 or more employees, your group health plan is your primary coverage. Medicare would be secondary.
If you were to have both Medicare and group coverage, your Medicare would supplement your group plan and may reduce some health spending. However, that might only be important to you if you have some health care spending going on and you just want more robust overall coverage. Its up to you.
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What If You Worked 10 Years Or Less
Most people will qualify for coverage by paying Medicare and Social Security taxes for 10 years through any combination of employers. Youll need to have spent 10 years doing taxable work to enroll in Medicare Part A for free. If youve worked for less than 10 years in the US, youll need to pay monthly premiums for Medicare Part A.
However, if your spouse who is 62 or older has enough quarterly credits or receives Social Security benefits, then youll still qualify. You may also be able to qualify based on your spouses work record if youre widowed or divorced.
Who Should Sign Up At 65 Even If They Have Other Insurance
This leaves a fairly long list of other types of insurance that become secondary payers to Medicare. Therefore, if you’re turning 65 and any of these situations apply to you, you should sign up for Medicare during your initial enrollment period.
- You have group coverage through your or your spouse’s employer, but the employer has fewer than 20 workers.
- You have retiree coverage, either through your former employer or your spouse’s former employer.
- You have group coverage through COBRA.
- You have TRICARE, the healthcare program for military service members, retirees, and their families. Retired service members must get Medicare Part B when eligible in order to keep their TRICARE coverage.
- You have veterans’ benefits.
- You have coverage through the healthcare marketplace or have other private insurance. Once your Medicare coverage begins, you’ll no longer get any reduced premium or tax credit for marketplace coverage, and you should drop this coverage as you’ll no longer need it .
If one of these situations applies to you and you don’t sign up for Medicare Part B during your initial enrollment period, you could face permanently higher premiums when you do.
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Am I Eligible For A Medicare Supplement Plan If I Have Coverage Through Medicaid
While some beneficiaries may be eligible for both Medicare and Medicaid benefits , Medicaid typically doesnt work with Medicare Supplement plans. You can only use your Medicare Supplement plan to pay for costs in Original Medicare.
If youd like to keep your Original Medicare coverage, but want to see if you can get help paying for some of the costs youre responsible for, you may want to check out which Medicare Supplement plans are available to you. I can help you with that.
- You can click the Compare Plans buttons on this page to look over plans on your own.
- Learn more about me by clicking on the View profile link below.
- Use the links below to schedule a phone appointment or have me email you Medicare information tailored to your needs.
New To Medicare?
Becoming eligible for Medicare can be daunting. But don’t worry, we’re here to help you understand Medicare in 15 minutes or less.
Signing Up For Medicare Part B At 65 If Youre Still Working
If youre still working at age 65 and youre not claiming Social Security benefits, the government will not automatically enroll you in Medicare Part B, which covers doctors visits, diagnostic tests, medical equipment, ambulance transportation, and mental health care.
If you work for a company with 20 or more employees and youre enrolled in your employers health insurance plan, you dont have to enroll in Part B. You also might not want to because it isnt free.
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What Should You Do Once You Get Medicare
Although you can rely on Original Medicare alone, 86% of Medicare enrollees also have some type of additional coverage.2 It can be from an employer, a privately-purchased plan or from a government-run program like Medicaid. Original Medicare pays for a great deal of healthcare, but still leaves you with potentially costly gaps in healthcare coverage. Supplementary plans can cover these gaps including deductibles and copayments at a fraction of the out-of-pocket rate.
MedicareGuide.coms plan selector is designed to intelligently bring you the best Medicare Supplement plans. These plans, also known as Medigap policies, fill the gaps in coverage that you would otherwise be charged by Original Medicare.
How Social Security Benefits Can Affect Medicare Enrollment
If you are receiving Social Security benefits when you turn 65, youll be automatically enrolled in Medicare Parts A and B, even if youre working. Your Medicare card will arrive in the mail about 3 months before your 65th birthday.
Once youre enrolled in Medicare, a monthly Part B premium will be automatically deducted from your Social Security check. If you dont want Medicare Part B, you need to notify Medicare to opt out. There will be instructions for doing this on the back of your Medicare card.
If youre not receiving Social Security or Railroad Retirement Board benefits, you will need to enroll yourself in Medicare when you become eligible.
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Can You Get Private Insurance Instead Of Medicare
If you have Medicare Part A or Part B, insurers generally arent allowed to sell you a traditional individual health insurance plan .
You can purchase individual health insurance if youve never enrolled in Medicare because you think the overall costs are too high. If youre in the unusual situation of paying for Part A premiums, you can also switch to individual health insurance.
If you develop a medical condition before turning 65 that would qualify you for Medicare, such as ESRD, you can decline to purchase Medicare.
If you decide to purchase private insurance once youre eligible for Medicare unless youre continuing the employer-sponsored insurance that qualifies you for a Special Enrollment Period then youll have to pay the costly late enrollment penalty once you do apply.
If youre nearing the age of 65, then its important you start considering your Medicare coverage.
Enrollment Windows Are Limited
If you’re thinking about delaying your enrollment in Medicare, keep in mind that there are enrollment windows that apply. After your initial enrollment window ends, you can only sign up for Medicare Part A and B during the general annual enrollment period from January 1March 31, with coverage effective July 1.
And you can sign up for Part D during the annual enrollment period from October 15December 7, with coverage effective January 1 of the coming year.
So if you delay your enrollment, you could be paying higher premiums when you eventually do enroll, and you’ll have to wait until an open enrollment period in order to have access to coverage. If you’re only enrolled in Part A, for example, and you get diagnosed with a serious illness in April, you’ll have to wait until the following January to have Part D coverage, and until the following Julymore than a year in the futureto have Part B coverage.
Keep all of this in mind when you’re deciding whether to enroll in the parts of Medicare that have premiums.
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Is Medicare Part D Mandatory
It is not mandatory to enroll into a Medicare Part D Prescription Drug Plan. However, if you go without creditable prescription drug coverage for 63 or more days in a row after youre first eligible, you may have to pay a late-enrollment penalty if you enroll into a Medicare Prescription Drug Plan or Medicare Advantage Prescription Drug plan later.
Read below to find out more about what kinds of coverage can help you avoid this penalty, when you can enroll in a Medicare Part D Prescription Drug Plan or Medicare Advantage Prescription Drug plan, and other information regarding the late-enrollment penalty.
What Is The Medicare Part D Late
If youve gone 63 consecutive days without creditable prescription drug coverage, either because you didnt enroll when you were first eligible or because you lost your creditable coverage and didnt get new coverage in time, then you may have to pay a late-enrollment penalty when you do enroll into Medicare Part D.
The Medicare Part D late-enrollment penalty is added to the premium of the Part D Prescription Drug Plan you enroll into. Your Medicare Prescription Drug Plan determines this penalty by first calculating the number of uncovered months you were eligible for Medicare Part D, but didnt enroll under Part D or have creditable coverage. Your Medicare Prescription Drug Plan will then ask you if you had creditable prescription drug coverage during this time. If you didnt have creditable prescription drug coverage for 63 or more days in a row after you were first eligible, the Medicare Prescription Drug Plan must report the number of uncovered months to Medicare.
For example, lets say you disenrolled from your Medicare Prescription Drug Plan effective February 28, 2021, and then decided to enroll into another Medicare Prescription Drug Plan during the Annual Election Period, with an effective date of January 1, 2022. This means you didnt have creditable prescription drug coverage from March 2021 through December 2021, which adds up to 10 uncovered months.
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If The Employer Has Fewer Than 20 Employees
The laws that prohibit large insurers from requiring Medicare-eligible employees to drop the employer plan and sign up for Medicare do not apply to companies and organizations that employ fewer than 20 people. In this situation, the employer decides.
If the employer does require you to enroll in Medicare, then Medicare automatically becomes primary and the employer plan provides secondary coverage. In other words, Medicare settles your medical bills first, and the group plan only pays for services that it covers but Medicare doesnt. Therefore, if you fail to sign up for Medicare when required, you will essentially be left with no coverage.
Its therefore extremely important to ask the employer whether you are required to sign up for Medicare when you turn 65 or receive Medicare on the basis of disability. If so, find out exactly how the employer plan will fit in with Medicare. If not, ask for that decision in writing.
Note that in this situation, signing up for Medicare Part B when you also have employer insurance will not jeopardize your chances of buying Medigap supplemental insurance after the employment ends. When Medicare is primary to the employer plan, you have the right to buy Medigap with full federal protections if you do so within 63 days of the employer coverage ending.
What Do Medicare Supplement Plans Cover
Medigap policies cover the following out-of-pocket costs:4
- Part A coinsurance and hospital costs up to an extra 365 days after Medicare benefits are used up.
- Part B coinsurance or copays.
- Blood .
- Foreign travel emergency .
- Above out-of-pocket limits.
The Part B excess charge is little understood but essential to know. Doctors who accept Medicare assignment agree to rates set by Medicare for covered services. Those who dont can charge up to 15% more than the Medicare-approved amount.
Unless you have a Medigap plan that covers excess charges, you will be responsible for those charges. The alternative? To only use participating doctors, although thats not always easy in an emergency or surgery involving many doctors.
Also, Original Medicare does not cover you outside the U.S. But some Medigap policies do.
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