Embracing 65: Navigating Medicare While Working

by | May 15, 2024

Turning 65 is more than just a milestone birthday; it’s also a significant transition into the world of Medicare. This shift brings many questions, especially for those who continue working. Let’s explore what you need to know about enrolling in Medicare while still employed and how to maximize your health coverage options.

Entering Medicare at 65

When you turn 65, you become eligible for the federal health insurance program Medicare. Enrollment in Medicare is automatic for those already receiving Social Security benefits. However, if you’re not receiving Social Security benefits yet, you’ll need to sign up for Medicare through the Social Security Administration. This is done as early as three months before your 65th birthday, birth month, and three months after, giving you seven months to enroll during your Initial Enrollment Period (IEP).

Working Beyond 65: Staying on Employer Health Benefits

If you’re among the increasing number of people working past 65, you may have the option to delay Medicare enrollment if you have health coverage through your employer. This decision largely depends on the size of your employer:

Employers with 20 or more employees: You can delay Medicare Part B (medical coverage) and Part D (prescription drug coverage) without penalty if your employer coverage is considered “creditable.” You’ll have a Special Enrollment Period (SEP) to sign up for Medicare without penalty when you eventually retire or lose employer coverage.

Employers with fewer than 20 employees: Medicare typically becomes your primary coverage, and your employer plan is secondary. In this case, enrolling in Medicare when you’re first eligible is usually advisable to avoid lapses in coverage and financial penalties.

Understanding Guaranteed Issue Rights

Transitioning to Medicare becomes more complex when considering supplemental plans like Medigap which covers costs not fully covered by Medicare Parts A and B. One critical aspect to be aware of is the “guaranteed issue rights.” These rights are crucial in your decision-making. You have guaranteed issue rights during the first six months you enroll in Medicare Part B. During this time, you can enroll in any Medigap policy, regardless of your health status. Once that guaranteed issue period expires, you may need to go through underwriting or health questions to change Medigap policies or enroll after leaving a Medicare Advantage Plan.

Special Situations: If you are covered under an employer or union plan when you first become eligible for Medicare, you’ll also have a guaranteed issue right to buy a Medigap policy when you eventually lose or leave that employer/union coverage, regardless of your health status. This period also applies if you used COBRA or retiree benefits, extending your window to switch without medical underwriting.

Medicare Advantage: Another Path

Alternatively, you might consider enrolling in a Medicare Advantage Plan (Part C). Private companies approved by the Centers for Medicare and Medicaid/CMS offer Medicare Advantage plans, often including additional benefits like dental, vision, and hearing care. During your IEP, you can join a Medicare Advantage Plan. These plans have no underwriting requirements at any age or stage of illness in Florida.

The Bottom Line

Turning 65 and managing healthcare decisions can be daunting, especially if you’re still working. The key is understanding how your current employment affects your Medicare options and using periods like the IEP and SEP to your advantage. Whether sticking with an employer health plan or switching to a Medigap or Medicare Advantage Plan, ensure your coverage is without interruption. Consider speaking to a Medicare broker to get the right fit for your financial and healthcare needs. Turning 65 is not just about getting older—it’s about getting wiser with your healthcare choices!

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