Planning your Drive Toward 65
It is very important for every becoming eligible for Medicare to get accurate information about coverage, including Medicare Supplement plans, and prescription drug coverage. Attention to these issues will help you avoid serious and costly problems later. This fact sheet will help you map your journey to Medicare highlighting roadblocks and warning signs along the way.
Some road signs you need to watch out for are:
- Start Planning Ahead – Ways to prepare for Medicare
- Enrollment – When and how you need to enroll in Medicare
- Working Past 65 – Information for beneficiaries who plan to work beyond age 65
- Supplemental Coverage – Choices in health insurance to supplement Medicare
- Get Help – Resources for further information at any turn of the road
Start Planning Ahead
Several months before turning 65 you should begin to learn more about Medicare and how it relates to your circumstances. For example:
- Request a copy of your Social Security Statement from the Social Security Administration at 800-772-1213 or socialsecurity.gov. This will specify how many credits of work you have and how much you have paid into the Social Security System. If you or your spouse have 40 or more credits of work and have paid into the Social Security System, you are eligible for premium-free Medicare Part A (Hospital Insurance) at age 65. If you do not have sufficient credits of work to qualify, you can buy Medicare Part A coverage. Everyone pays a premium for Medicare Part B (Medical Insurance).
- If you have been on Medicare due to disability, you have a brand new six-month Open Enrollment Period for purchasing Medicare Supplemental Insurance when you turn 65.
- Talk to your employer’s benefit office and ask for any information about company health insurance after age 65. If you have an employer group health plan (EGHP) that will continue to pay secondary after you become eligible for Medicare, study the benefits booklet to find out the cost and benefits of the plan. You will then need to decide if you should keep your EGHP as secondary to Medicare or if you need to drop your EGHP and purchase a Medicare Supplement. If you EGHP has drug benefits, make sure they are as good as or better than Medicare Part D.
- If you will not be covered by an EGHP plan that will pay secondary to Medicare, begin to investigate other health insurance options – such as an individual Medicare Supplement Policy (Medigap). gov can provide you with information on Medicare Supplement Plans, Medicare Advantage Plans and Medicare Prescription Drug Plan (Medicare Part D) options.
- Learn more about what Medicare will and will not cover. Get a copy of Medicare & You Handbook or The Guide to Health Insurance for People with Medicare from the Social Security Administration or from Cornerstone Medicare. Understanding what Medicare covers and does not cover will give you some idea of the health plan you will need.
- As a New Medicare beneficiary you are entitled to a one-time Welcome to Medicare Wellness Physical within six months of the day your Medicare Part B becomes effective.
If you are already receiving Social Security benefits, Railroad retirement benefits, or Federal Retiree benefits your enrollment in Medicare is automatic. Check with Social Security to verify your Automatic Enrollment as well as your current address. Your Medicare card should arrive in the mail shortly before your 65th birthday. Check the card when you receive it to verify that you are entitled to both Medicare Parts A and B.
If you are not eligible for Automatic Enrollment, contact the Social Security Administration at 800-773-1213 or www.socialsecurity.gov, or visit the nearest office to enroll in Medicare Part A and to enroll in Medicare Part B. You have a seven-month window in which to enroll in Medicare without incurring a penalty.
|Initial Enrollment Period (7 Months)|
|Three months before 65th birthday||Birthday Month||First month after 65th birthday||Two to three months after 65th birthday|
|Enroll here and your Medicare is effective the first day of your birth month||Enroll here and your Medicare effective date will be delayed until the first day of the month following the month you actually enrolled||Enroll here and your Medicare effective date will be delayed until the first day of the second month you actually enrolled||Enroll here and your Medicare effective date will be delayed until the first day of the third month following the month you actually enrolled|
During this Initial Enrollment Period, you will also have the option to enroll in a Medicare Prescription Drug Plan (PDP) available under Medicare Part D. Enrollment in a Medicare PDP is strictly voluntary. These plans are offered by Cornerstone Medicare, and Medicare helps pay for the coverage. If you fail to enroll in a Medicare PDP during your Initial Enrollment Period and you do not have equal, or better coverage, through an EGHP, you Will Incur a 1% penalty for each month that you are late enrolling, and you will only be allowed to enroll during the Nov 15th through Dec 7th Annual Coordinated Election Period.
If you do not enroll in Medicare Parts A and B during your seven-month window of eligibility you cannot enroll until the General Enrollment Period, which is Jan 1 through March 31 each year (unless you are entitled to Special Enrollment – Explained a little later). Your Medicare Eligibility will not begin until the following July 1. Your monthly Medicare Part B Premium will increase to include a permanent 10% penalty for each year of delayed enrollment (unless you are eligible for Special Enrollment).
General Enrollment Period for Medicare Part A & B (Every Year)
- January 1 through March 31
- April 1 through June 30 – No Medicare Coverage
- July 1 – Medicare Coverage begins with a penalty
Working Past 65 (Special Enrollment)
If you or your spouse are actively working at age 65, are covered by an employer’s group health plan (EGHP) and the company has 20 or more employees, you may be able to delay Medicare Part B coverage without a penalty. You will still be eligible for Part A without paying a premium (as long as you or your spouse has 40 credits of work).
- Talk to your employer’s benefits officer and ask for information about company health insurance options for people who continue to work past their 65th Ask specifically how many hours you must work to keep your health insurance plan and whether the EGHP will be “primary” or “secondary” coverage to Medicare. Carefully study the company’s current benefit booklet to determine cost and benefits of the plan.
- If your EGHP is primary to Medicare, you do not have to enroll in Medicare Part B at this time. You will need to enroll in Medicare Part B within eight months of the EGHP’s termination of coverage or when it stops being primary. If your EGHP will be secondary to Medicare despite active employment, you MUST enroll in Medicare Part B during the seven-month Initial Enrollment Period to avoid future penalties. If you voluntarily disenroll from your EGHP before terminating your employment, you could lose your EGHP benefits when you retire.
- Contact the Social Security Administration at 800-772-1213 or go to socialsecurity.gov or the nearest Social Security Office to confirm that you have enrolled in Medicare Part A.
- Give written notice to your company of your intention to continue working after age 65. When you decide to stop working, notify the Social Security Administration immediately. It is also advisable to notify the Social Security Administration that you or your spouse, if covered under your EGHP, will continue to work beyond age 65.
Medicare is a Major Medical plan that provided a basic foundation of benefits. However, it does not pay 100% of all medical bills. Medicare beneficiaries are responsible for premiums, deductibles, and coinsurance. These amounts can be significant. Because of these costs, most beneficiaries need some kind of plan, policy, or program to fill in the “gaps”.
Medicare Supplement Insurance
Medicare Supplement plans are a health insurance option for people with Medicare. There are 10 standardized Medicare supplement insurance plans available that are designed to fill the gaps left by Original Medicare (Parts A & B) These are sold by Private Companies as individual insurance policies and are regulated by the Department of Insurance. After age 65 and for the first six months of eligibility for Medicare Part B, beneficiaries have an Open Enrollment Period and are guaranteed the ability to buy any of these plans from any company that sells them. Companies cannot deny coverage or charge more for current or past health problems. If you fail to apply for a Medicare Supplement within your Open Enrollment Period, you may lose the right to purchase a Medicare Supplement Policy without regard to your health. Information about Medicare Supplement Plans sold in your state is available by calling Cornerstone Medicare at 888-384-5017.
Medicare Prescription Drug Coverage – Medicare Part D
The Medicare Prescription drug Plans (PDP’s) are sold by private insurance companies approved by Medicare. All people new to Medicare have a seven-month window to enroll in a PDP – three months before, the month of and three months after the Medicare becomes effective. The month you enroll affects the PDP’s effective date. All people with Medicare are eligible to enroll in a PDP, however, unless you are new to Medicare or are entitled to a Special Enrollment Period, you must enroll during the Annual Coordinated Election Period Nov 15th through Dec 7th. There is a monthly premium for these plans. If you have limited income and assets/resources, assistance is available to help pay premiums, deductibles, and co-payments. You may be entitled to Low-Income Subsidy Assistance (LIS) or “Extra Help” through the Social Security Administration.
To Get Help
Medicare – 888/633-4227 www.medicare.gov
Medicare provides information 24 hours a day, 7 days a week about eligibility, enrollment, and coverage.
Social Security Administration – 800/772-1213 www.socialsecurity.gov
Contact the Social Security Administration to enroll in Medicare or to request a replacement Medicare Card.
To speak with a Cornerstone advisor about your specific Medicare needs, call 888-384-5017 or submit a request for an advisor to speak with you. Click Here.