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Medicare vs Employer Coverage – What Is Right For You?

doctor visit - medicare vs employer coverage

If you are turning 65 but you’re still working, what do you do about Medicare? That’s a question that a lot of people ask us. That’s why today’s blog post is all about Medicare vs employer coverage.

Decision about Medicare vs employer coverage

A lot of people decide to keep working when they turn 65 years old and therefore become eligible for Medicare. If you are in this situation, it’s important that you know what steps to take or what decisions to make: If you do not do things correctly, there could be consequences. 

The first thing to know before deciding whether to stay on your employer insurance coverage group plan or switch to Medicare insurance is knowing the size of the company you work for. It does make a difference how many regular employees your employer has. 

Medicare vs employer coverage at a company with less than 20 employees

If you work for an employer with less than 20 employees, Medicare will be your primary insurance, and your employer plan will be secondary. 

In that case, you will want to enroll in Medicare full-time and dis-enroll from your employer plan. You will also want to make sure that you enroll in both parts A and part B. Once you are enrolled in A and B, you can decide whether to enroll in a Medicare supplement plan or a Medicare Advantage plan.

By the way, we have published a few Youtube videos with explanations about both Part A and Part B. You can find those links below this blog post

Medicare vs employer coverage at a company with more than 20 employees

If your employer has more than 20 employees, then your employer plan will be your primary insurance, and Medicare will be secondary. This means that your group plan will pay your medical costs first. In this instance, you can stay on your group plan and delay enrolling in Medicare until you retire. 

In that situation, you’ll want to make sure that you do not enroll your enrollment in part B or rather delay it. There are a few reasons why you want to do that:

Part B has a monthly premium that has to be paid, even though it’s something that would not be used yet under the given circumstances. Therefore, most people don’t want to pay for it. If you do not intend on using Medicare while being on an employer plan, you would rather not enroll in Part B and pay unnecessary monthly premiums.

Timing does matter when enrolling in Part B

Once you reach six months out from the effective date of your Part B enrollment, you are no longer eligible to get any plan you want. You will also have to go through underwriting or answer health questions. In addition, there is a possibility of being denied. 

This usually applies to a Medicare supplement plan. (Medicare Advantage plans typically don’t ask health questions.) 

Another reason to delay your Part B: The first time you enroll in Part B, you’re eligible to get onto any Medicare plan you want without any health or underwriting questions. 

When it comes time for you to retire and go on to Part B full-time, there are a few forms to fill out:

  1. Your part B enrollment form, which you need to fill out. 
  2. The second one is a form for Social Security that your employer fills out.

Spousal coverage

When it comes to spousal coverage, it depends on the situation: Is the employee turning 65 first, or is the spouse who is turning 65 first? The spouse may or may not want to go onto Medicare when they turn 65 because the group plan may not cover them as much as a dependent as Medicare would. 

If you have any questions relating to your individual situation, we gladly offer to go over that in more detail. Please feel free to contact us, and we will be more than happy to help.

Writing: "Almost time for Medicare" - Medicare vs employer coverage

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