Making the decision to enroll in Medicare

Retirement age has been advancing in recent years. Ten years ago, 76% of people 65 years old were retired. Today, only 33% are retired. There are many reasons for the change.  The increase in age needed to qualify for full Social Security benefits is a major driver of the change.  As a consequence of the change, older adults now face the decision whether to enroll in Medicare benefits at age 65 or continue to utilize employer provided benefits. In some instances, employers may require Medicare enrollment for eligible employees. There are decisions to be made, and you need accurate information to make the best decisions.

There are several different kinds of health insurance. If you are becoming eligible for Medicare but you already have insurance, learn whether/how your current plan works with Medicare and what decisions you need to make and actions you need to take.

Below is some information from the Center for Medicare Rights which may be helpful to you.

How does Medicare work with other kinds of insurance from an employer?  

Job-based insurance: Insurance offered by an employer or union for current employees. If you are covered by your or your spouse’s (or in some cases, your family member’s) job-based insurance, it may work with Medicare to cover your health care costs. Job-based insurance may also allow you to delay Medicare enrollment. Job-based insurance either pays primary or secondary to Medicare, depending on the size of the employer. See questions 4-8 for more information.

Retiree insurance: Insurance plans that employers may provide to former employees who have retired. Retiree insurance always pays secondary to Medicare. See questions 9-10 for more information.

What are primary and secondary payers?

When you have Medicare and another type of insurance, Medicare will either pay primary or secondary for your medical costs.

• Primary insurance pays first for your medical bills.
• Secondary insurance pays after your primary insurance.

Usually, secondary insurance pays some or all of the costs left after the primary insurer has paid (e.g., deductibles, co-payments, coinsurances). For example, if Original Medicare is your primary insurance, your secondary insurance may pay for some or all of the 20% coinsurance for Part B-covered services. You may find secondary insurance useful in lowering your health costs depending on how much coverage your primary insurer offers and its costs.

If your primary insurance denies coverage, secondary insurance may or may not pay some part of the cost, depending on the insurance.

If you do not have primary insurance, your secondary insurance may make little or no payment for your health care costs.

If you are considering delaying Part B enrollment because you have insurance, make sure to ask your benefits manager or human resources department how your insurance works with Medicare. In cases where Medicare is primary to your current insurance, you should enroll in Part B to avoid incurring high costs for your care. This is because when Medicare is primary to your other insurance, your other insurance may not pay for costs until Medicare pays—so you would be responsible for paying these costs out of pocket. When Medicare is secondary, your current insurance will pay the majority of the cost for covered services.

Should you delay enrolling in Medicare Part B if you have job-based insurance when you turn 65?

If you are eligible for Medicare due to age (meaning you are 65+) and are covered by your or your spouse’s job-based insurance, you have a Special Enrollment Period (SEP) to enroll in Part B. This SEP starts the first month you are eligible for Medicare, if you are covered by job-based insurance, and ends eight months after you no longer have coverage from current work. When you use the Part B SEP to enroll in Medicare, you do not face a late enrollment penalty when you later sign up for Part B, and you can choose to sign up at any point in the year. However, remember that in most cases you should only delay Part B enrollment if your job-based insurance is the primary payer.

For those eligible for Medicare due to age:

Job-based insurance is primary if it is from an employer with 20+ employees. Medicare is secondary in this case, and some people choose not to enroll in Part B because of the additional monthly premium.

Job-based insurance is secondary if it is from an employer with fewer than 20 employees. Medicare is primary in this case, and if you delay Medicare enrollment, your job-based insurance may provide little or no coverage. You should enroll in Part B to avoid incurring high costs for your care.

If you have questions about Medicare and want assistance exploring your options, contact a CHOICES counselor at 1-800 -9949422.