Ask The Medicare Specialist

QUESTION:

I’m a 65-year-old female, Question from Debbie: soon to be 66 in May of 2024. I work full time and have health insurance through the company my husband retired from which we pay a monthly premium for. The advice I was given as I was turning 65 was not to sign up for Medicare Parts A and B because I work full time. I’m now being told I need to sign up regardless of my employment status because my health insurance is through my spouse, not my employer, and that I need to do that by March 1st, 2024. I was also told I should sign up for Medicare Part B, so I don’t get a penalty later, that I need to pay that premium as well as the cost for being on my spouse’s retiree coverage. I am very conflicted. Can you please give me the correct information as far as my situation is concerned?

ANSWER:

Who should sign up for Medicare or opt out of Part B is extremely confusing for those tuning 65, especially with more and more people working full time past that age. It’s also an area where people get bad information and often make mistakes. Debbie is an example of this. Let me explain.

Debbie’s husband is retired, and not currently an employer of the company providing their health insurance. Therefore, she should have signed up for both Medicare A and B when she turned 65. Only those who are “working,” or has a spouse who is “working,” and getting health insurance through an employer can opt out of Part B without a late enrollment penalty and then sign up anytime during the year upon retirement. It’s a good thing Debbie reached out when she did, because she will avoid a Part B late enrollment penalty if she signs up by March 31st (not March 1st) for an April 1st effective date. Had she not contacted me and continued to stay on her husband’s retiree plan without having Part B, she would have started to accrue a 10% penalty in May. Every 12-month period she waited to enroll after that, another 10% penalty would have been added. For example, someone who went five years without Part B who should have had it, would pay a 50% penalty that never expires. It lasts a lifetime!

Let me repeat this again. Those who are working or have a spouse who is working and get insurance through that employer DO NOT have to enroll in Part B and WILL NOT have a late enrollment penalty when they ultimately retire.

As far as the advice Debbie got about not getting Part A and B when she first turned 65 was wrong. Enrolling in A or not has nothing to do with employment status alone. Almost everyone should enroll in Part A when they’re first eligible. First of all, it’s no cost. And secondly, it could come in very handy for those who get their health insurance from an employer because most of those policies have a significant deductible and Maximum Out of Pocket (MOOP). In the event of an inpatient hospitalization, Part A could save someone thousands of dollars. The only people who should not sign up for Part A are those who get their insurance from an employer, have a plan that is paired with a Health Savings Account (HSA) and want to make deposits into their HSA that provide tax benefits. She should have enrolled in Part B because her health insurance was not from a company she or her husband was currently employed with.

It’s also not a slam dunk that Debbie should stay on her husband’s plan, which will convert to a Medicare Advantage PPO once she has Medicare A and B. She may get better value or coverage from another Advantage Plan or a Supplement. My advice to her will depend on what that retiree PPO will cost and what the benefits look like which include co-pays, MOOP, drug costs, and extra benefits such as dental and vision her it has.

Debbie was given a lot of bad advice when she was turning 65. The lesson is you can’t trust what I call “over the fence advice” that friends, co-workers, or family might give when it comes to enrolling in or opting out of Medicare Parts A and B. It’s also not uncommon for a Human Resources advisor or Social Security representative to give the wrong guidance. If you want to know with 100% certainty what your best move is regarding Part B and Medicare plans, reach out to one of our offices or email me. And when the time comes to enroll in Medicare, we’ll walk you through the process, ensure it’s done correctly and in a timely manner, and then guide you to the right Medicare plan, be that through the open market, an employer, or as a retirement benefit.

I’d like to remind everyone once again about our Facebook group with the same name as the columns, which are posted there along with two other exclusive weekly features that are very educational. Go to our website and click on the blue banner at the top of our page to join.

We also do a live radio show every first and third Monday of each month from 1-3 on WMBS 590 am out of Uniontown. You can listen from the station website, wmbs590.com. I’m hosting on February 5th. Lastly, we’re working on an online newsletter that will be made available to clients as well as their friends and family who request to receive it. The focus is going to be on nutrition and health for seniors. We have a registered nurse who is providing the content and we’re also looking forward to having some Western PA doctors contribute as well. The goal is to have the first edition ready by March and then distribute it quarterly and eventually monthly.