As thousands of workers turn 65 everyday, Benefit and HR managers will be fielding more and more questions like this:
I will be eligible for Medicare in six months but do not plan to retire for a few more years. I am not sure how Medicare will work with the insurance I receive through my job. I know that I am eligible for Part A and Part B. I have heard if I do not enroll in Medicare Part B, I will have to pay a penalty. Can I get better coverage and save money if I just enroll in Medicare and drop my companies insurance? I have a lot of questions and am not sure what to do.
Over the years, I have seen well-meaning Benefit Managers and HR professionals give inaccurate advice about Medicare that became very costly to their employees. To start with, Medicare is very complicated and every individual’s situation is different based on their health status, income, and if they need to cover dependents. For some individuals, it may be best to completely transition to Medicare and get off their employer’s plans. For others that could be the worst thing to do.
The only way to determine what is best for each employee is to do a comprehensive benefit and cost comparison of their current employer sponsored plan, verses signing up for Medicare and getting a supplement plan. Which is not something I recommend you do for several reasons.
The best way to help yourself and your employees with Medicare is by establishing a relationship with an independent, third party Medicare Specialist who can properly represent and advise the employee. This provides the employee a Medicare expert and relieves you of the liability of giving out inaccurate information that could come back to bite you and your employee.
Most individuals are automatically enrolled in Medicare Part A (Hospital Coverage) and it requires no premium. Medicare Part B (Medical Services) must be elected and a monthly premium is paid. That premium is based on the individual’s income and could range from $135.50 to $460.50 a month. It is normally best to delay signing up for Medicare part B if the employee is going to continue on the company’s health insurance.
By law, you cannot encourage an employee to leave the company health plan and move to Medicare, even if it is their best solution. By law, if the employee is participating in a HSA plan they must delay both Medicare Parts A and B.
The company’s medical plan will be primary and the employee’s Medicare will be secondary. If you have less than 20 employees Medicare will be primary.
If you have questions about Medicare you can contact Greg Downing at (512) 656-9378 or [email protected].
Greg Downing is a Licensed Insurance Professional at Texas Medicare Advisors in Austin, Texas. He has helped hundreds of individuals with Medicare and individual health plans. His Medicare expertise is utilized by many financial and insurance professionals to help their clients transition to Medicare.
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