Working at 65 - Things to Know about Medicare and Employer Health Insurance
For many reasons, more and more people are choosing to work after they reach the age of 65.
As you approach age 65, you will want to make sure you understand all your health insurance options if you do not plan to retire.
Everyone has different health care needs, insurance choices and personal finances. As a result, there are many exceptions to Medicare rules and health insurance guidelines that might apply to your specific situation. With that in mind, here are some common scenarios and things to consider.
Remain on your employer's group health plan
Depending on the number of employees a given employer has, the law does not require your employer to offer employees who are 65 (and eligible for Medicare) the same coverage as other employees. In other words, smaller businesses can require you to enroll in Medicare. In this case, at age 65, you typically would have to choose one of these options:
Employers with 20 or more employees are required to offer current employees who are 65 and older the same group health plan options that are offered to all other employees. In other words, it is your choice to enroll in Medicare or not.
- If you remain in your employer's health plan and do not enroll in any parts of Medicare, the group health plan will continue the coverage it provided before you turned 65.
Stay on an employer's health care plan, and sign up for itemized parts of Medicare
If your employer has 20 employees or more, you can remain on your employer's plan and enroll in Medicare Part A. You may delay enrolling in Medicare Part B and Medicare Part D. The following factors may determine if this is the right course of action for you:
- If money was being deducted from your paycheck for 10 years or more during your working life, you have probably earned premium-free Medicare Part A coverage.
- You may enroll in premium-free Medicare Part A and delay enrollment in Medicare Part B. Paying the monthly premium for Medicare Part B may not be to your advantage. If you delay enrolling in Medicare Part B and/or Medicare Part D, special rules will apply to your right to enroll without paying late-enrollment penalties . When your situation changes and you want to enroll, make sure you know the rules and timeframes for special enrollment periods.
You can choose to enroll in Original Medicare (Medicare Part A and Medicare Part B) while being enrolled in an employer's health plan. The particular concerns are:
- In most cases, your employer's plan would be the primary payer of your health care costs, and Medicare would be the secondary payer.
- Special rules apply to Medicare Part D and the prescription drug coverage in a group health insurance plan. Ask your employee benefits department about how your employer's prescription drug plan differs from Medicare Part D.
- Overall, you may end up paying a lot more for your health care. For example, you could end up having to send a monthly check to Medicare for your Part B premium and also paying your group plan premium through payroll deduction.
Decline your employer's group health plan and enroll in Medicare
In most cases, you can decide to enroll in Medicare at age 65 and decline your employer's group health plan. Before you do that, here are some things to keep in mind:
- For the same monthly premiums and annual out-of-pocket costs, your employer's plan may cover a larger percentage of your health care costs than Medicare. Employer plans may also include benefits that are not covered by Medicare at all.
- If any family members (a spouse and/or children) are covered by your employer's group plan, they would lose their health care insurance.
- If you change your mind, it may be impossible to rejoin a job-related group health plan. Also, once you enroll in Medicare, you can't make new contributions to a tax-advantaged health savings account (HSA). So using pretax income to pay for future health care may not be possible.
As you plan to work beyond age 65, there are many other scenarios that may match your unique circumstances. Make sure you carefully review and weigh the benefits of your employer's group health plan coverage against the various Medicare options. You'll also want to do a cost comparison.
Learn which Empire Medicare Advantage plans are available in your area. Empire has online tools to help you do comparisons of the types of plans that might be best for you as you transition from your primary health insurance.
Additional information and resources
Whether you plan to work beyond age 65, or if you are ready to retire, the official Medicare website is a great place to learn about your options. There are tools and informative content available at Medicare.gov, and the site is easy to use. You'll find helpful resources, including Medicare and Other Health Benefits: Your Guide to Who Pays First, which you can download as a PDF file.
Help is also available through your State Health Insurance Counseling and Assistance Program (SHIP). This program provides objective volunteer counselors who offer free, personalized Medicare counseling. You can also call Medicare at 1-800-MEDICARE (1-800-633-4227). TTY users, please call 1-877-486-2048. Lines are open 24 hours a day, 7 days a week.
Y0071_15_22221_U CMS Accepted 11/12/2014
Empire BlueCross BlueShield is an HMO Health plan with a Medicare contract. Enrollment in Empire BlueCross BlueShield depends on contract renewal. Empire BlueCross is an HMO plan with a Medicare contract. Enrollment in Empire BlueCross depends on contract renewal.
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Empire BlueCross BlueShield is an LPPO plan with a Medicare contract. Enrollment in Empire BlueCross BlueShield depends on contract renewal. Empire BlueCross is an LPPO plan with a Medicare contract. Enrollment in Empire BlueCross depends on contract renewal.
Services provided by Empire HealthChoice Assurance, Inc. licensee of the Blue Cross and Blue Shield Association, an association of independent Blue Cross and Blue Shield plans.