7 Inside Tips to Help You Make a Smooth Move to Medicare
Published by: Medicare Made Clear
How many times have you heard that Medicare is “complicated” or “confusing”? It’s enough to make anyone dread dealing with it, right?
Well here are seven inside tips that just might help clear a path to Medicare enrollment for you.
Medicare Tip 1: You Can Sign Up for Medicare As Early As 3 Months Before You Turn 65
Medicare eligibility begins at age 65, but you can sign up earlier to make sure your coverage starts as soon as possible. You will have a 7-month Initial Enrollment Period (IEP) that starts 3 months before the month of your 65th birthday. If you sign up during the first three months of your IEP, your Medicare coverage will kick in on the first day of your 65th birthday month. If you sign up later on in your IEP your coverage could be delayed.
Medicare Tip 2: Find Out If You’ll Be Enrolled in Medicare Automatically
If you currently receive Social Security or Railroad Retirement Board benefits, you’ll be automatically enrolled in Original Medicare (Parts A & B). Medicare will mail your Medicare card to you. This applies if you are eligible for Medicare due to age or disability. Your coverage will go into effect on the first day of your 65th birthday month or the month of your 25th disability check.
NOTE: You will still have your IEP during which you may make other coverage choices such as getting a Part D prescription drug plan or Medicare Advantage plan.
Medicare Tip 3: Consider Delaying Medicare Part B
You may be able to postpone Part B – and delay paying the premium – if you have other creditable coverage. You might be working past 65 and have employer-sponsored health insurance with an employer that has 20 or more employees, for example. Or maybe you have employer-coverage from a spouse’s employer, and that employer has 20 or more employees and allows covered-dependents to delay Medicare enrollment.
Check with the plan benefits administrator before deciding to postpone your Part B enrollment. You need to confirm that you have creditable coverage and ask for written proof (especially for your drug coverage) to ensure you can qualify for a Special Enrollment Period.
Phil Moeller - Large Employers
On-screen text: Medicare Conversations - Working Past 65…
On-screen text: My employer has 20 or more employees, what about Medicare?
On-screen text: Phil Moeller, Author and Medicare Expert
Hi, I'm Phil Moeller. I write articles and books about retirement and health care, and I've written a lot of pieces about Medicare.
When people approach 65 and decide to keep working, they have some important decisions to make about Medicare.
I'm going to talk today about the decisions you need to make when you work for a large employer with 20 or more employees.
Medicare rules in that situation, give you the right to do nothing if you choose.
But it also sets up a series of possible decisions, and I want to sort of talk about those today.
There are really three pathways here.
The first one, as I said, is you can keep your employer plan and you don't need to get Medicare.
The second approach is, you can keep your employer plan and you can also get Medicare, and there are some situations where that makes sense.
The third pathway is, well, you can get Medicare and you can drop your employer plan.
So, these are the three pathways. Let's talk about them in order.
On-screen text: I only want my employer plan.
So, when you decide that you're simply going to do nothing and keep your employer plan, there's one wrinkle I want to make sure you're aware of.
Even though your employer is obligated to continue offering you health coverage, including drug coverage, Medicare rules stipulate that your drug coverage in your employer plan has to be at least as good as a typical Medicare Part D plan.
If it is, fine, and your employer has to give you a statement that attests to this.
People don't know that their statement even exists, let alone they should ask for it. But your employer has a legal obligation to provide this.
It's a key piece of paper for you because if your plan is creditable, you're fine, but if your plan's not creditable, then you have to get a Part D plan.
Even though you're going to keep your employer coverage.
In that situation, you can get a Part D plan without having to also pay for Part B.
All you have to have is Part A, and you get a Part D plan, you keep your employer plan.
That's the most significant sort of implication of keeping your employer plan as far as Medicare is concerned.
On-screen text: I want Medicare and my employer plan.
The second situation is you decide, "Well, I think I want to keep my employer plan and I also want to get Medicare."
In that situation, you really need to pay attention to, what is Medicare going to give me or get for me that my employer plan is not going to cover?
Historically, people tended to just keep their employer plans and they didn't worry about getting Medicare when they turned 65.
However, employer plans have changed a lot in recent years.
Many people now have what are called high deductible health plans.
You may pay three, four thousand dollars or even more out of pocket before your employer health coverage starts helping you pay those bills.
In that case, it can make a lot of sense to get a Medicare plan, which can help pay that deductible for you.
Also, Medicare may cover some things that your employer plan doesn't.
In particular, a Medicare Advantage plan can cover health clubs, dental, hearing and also some vision coverage that your employer plan may or may not cover as well.
So, look at what your employer plan covers, see what you're exposed to in terms of cost and coverage features, and then you may decide that you actually want both.
On-screen text: I only want Medicare.
The third thing is, you look at your employer plan and you look at what Medicare offers and you say, "Well, that's pretty expensive to do both of these.
Maybe all I need is Medicare." And that's quite possible.
You need to understand what Medicare will cover and see what would happen to you, if you don't have that employer plan anymore.
In that case, you also need to pay attention to what happens to your family.
If your spouse and your children are insured on your employer plan, you probably want to think long and hard before you drop that employer plan.
Although, it's still possible that you and they could be better off if you dropped your employer plan and they went on a state insurance exchange and got their coverage.
Those are decisions that you can make.
One thing I will say is that, you don't want to wait too long to make these decisions and you also don't want to guess about what's going on. Because you can't make an informed decision if you're not informed, to say the least.
On-screen text: So, what’s the takeaway?
We've covered lots of ground today, so let's recap a bit.
If you work for a large employer with 20 or more employees, the employer must continue offering you health coverage.
You have three decisions: you're going to just keep your employer plan, you're going to get Medicare plus your employer plan, or you're going to drop your employer plan and just get Medicare.
All of these decisions should be based on information and knowledge about what's covered, what's not, what it costs.
That's information that you need to get from your employee benefits department and you need to get it before you turn 65.
Don't dawdle here. You really need to act on a timely basis to make sure you make informed Medicare decisions.
If you have any more questions, you can go to MedicareMadeClear.com and get additional information.
Thanks so much for spending some time with me.
Medicare Tip 4: Choose A Medicare Plan with Benefits You Need
Once you sign up for both Part A and Part B, you have to consider if you need further coverage. Parts A and B only cover hospital and medical coverage, respectively. This means things like drugs and dental are not provided for.
Part D plans can provide prescription drug coverage.
Medicare Advantage plans can provide prescription drug coverage & additional benefits such as dental, vision or hearing coverage.
Identify what you need and want covered before selecting the kind of Medicare coverage you end up with.
Medicare Tip 5: You Can Add Additional Coverage to Government-Sponsored Original Medicare
If you choose Original Medicare, you can add additional coverage. For example, many people add a Medicare Part D plan to help with prescription drug costs. These plans are offered by private insurance companies.
Medicare Tip 6: Enroll On Time to Avoid Late Enrollment Penalties.
Medicare Part B and Part D may add penalties to your premium payments if you enroll after your IEP ends and don’t qualify for a Special Enrollment Period. If you don’t qualify for premium-free Part A, you’ll also face late penalties for Part A if you miss your IEP. Each part has its own rules for timing and for calculating the penalty.
The Part B penalty is an additional 10% of the premium amount for each full 12-month period you could have had Part B and didn’t. The penalty is charged every month for as long as you have Part B.
The Part D penalty is an additional 1% of the average Part D premium for each month you delay enrollment. The penalty amount may change each year along with annual Part D premiums. It’s charged every month for as long as you’re enrolled in Part D.
The Part A penalty is an additional 10% of the premium amount and is charged every month for twice the number of years enrollment was delayed.
Medicare Tip 7: Evaluate Your Coverage Every Year
You don’t have to keep the same Medicare plan every year. The Medicare Annual Enrollment Period is October 15 to December 7 every year. During this time, you can join, switch or drop a Medicare Advantage plan or a prescription drug plan. It’s a good idea to review your Medicare coverage every year to make sure it still serves your needs.
You will automatically go back to Original Medicare if you drop a Medicare Advantage plan during open enrollment, and you will lose drug coverage if it was included with your plan. You may replace drug coverage with a stand-alone prescription drug plan at this time without penalty. A penalty may apply if you drop drug coverage and more than 63 days pass before you get it again.
Keep These Tips in Mind to Make Medicare Enrollment Easier
It may feel like Medicare is a vast and overwhelming maze. Partly that’s because Medicare serves millions and millions of people, each with his or her own set of circumstances, and the program must anticipate and accommodate them all. Focus in on what applies to your personal situation and choosing your Medicare coverage will be a lot easier.