Working Past 65? Avoid These HUGE Medicare Mistakes!

No one really wants to work past the age of 65.

Or maybe they do… it takes all sorts to make a world!

But, if you are working past the age of 65 and bringing in those extra bucks make sure it’s not a waste by avoiding some of these HUGE Medicare Mistakes!

Defer Part B

First things first, if you are working past the age of 65 and maintaining creditable coverage, please go ahead and defer Part B.

Maybe…

Compare the cost of your monthly premium to your Part B monthly premium. If your monthly premium is lower than what you would pay for Part B, this is a no brainer.

If not, you need to consider other costs with Original Medicare and how you may wish to supplement those costs with Medigap aka Medicare Supplement Plans.

Understanding Costs

Original Medicare Medicare is comprised of Part A and Part B.

Part A is your hospital insurance. It will help to cover things like:

• Inpatient Care
• Nursing Home Care
• Skilled Nursing Facility Care
• Hospice Care

And Part B is your medical insurance-basically anytime you see a doctor. It will help to cover things like:

• Outpatient Services
• Ambulatory Services
• Durable Medical Equipment
• Preventative and Wellness Visits
• Diagnostic Services
• Limited Prescription Drugs (iv drugs, chemotherapy, some oral anti cancer drugs, insulin if administered via pump, etc…)

Now although Original Medicare provides excellent coverage, there are financial gaps and costs associated with Original Medicare such as copays/coinsurance and deductibles. Depending upon your health and frequency of care, these bills can amount to thousands and thousands of dollars. There is also no out of pocket maximum.

Medigap

This is why many people wish to supplement their coverage with a Medigap plan. These plans will fill in those financial gaps i.e. deductible and copays and coinsurance.

There are 10 different plans to choose from with varying levels of coverage.

So, the reason you need to know this now has to do with medical underwriting and medigap enrollment.

Let’s say you currently have a group health insurance plan that is actually more expensive than what your Part B premium would be. Well, it would be tempting to make the switch right now to Medicare.

But wait. This affects your Medigap enrollment.

You have a 6 month window after you turn 65 and enroll in Part B to enroll in a Medigap plan with no medical underwriting. That means you cannot be charged more or denied based on your health.

Should you choose to enroll outside of this window, you will likely be subject to medical underwriting which means you could be charged more or denied. This is extremely common.

So, if you are prepared to switch from your group health insurance plan to Medicare make sure you are ready to absorb that Medigap premium as well. Because if you don’t enroll now, you may not be able to at a later date.

And you can’t just enroll in one of the more bare bones, less expensive plans now and switch at a later date. This is pretty much a commitment for life. That’s why it’s important to work with a broker who is familiar with the plans and can guide you toward a plan with a history of lower more stable rate increases. 

So, add your Part B premium to whatever your Medigap premium would be and compare that to what you currently pay.

If you have a family plan with dependents, you’ll need to take that into consideration as well. 

Now if you do decide to defer, make sure to follow the instructions on the back of the card and send it back. If you keep the card, you will keep Part B. Not only will you be charged for it, but as I said, you may be missing out on the 6 month window free of medical underwriting. 

When you do decide to retire, please make sure to re-enroll on time. Otherwise, you may be subject to the dreaded late enrollment penalty.

Remember this gets tacked onto your monthly premium forever. It’s not a one time penalty.