Published: May 2021
By: Maureen Wilkin, Federal Benefits Specialist
If you are or soon will be age 65, it is time to consider enrolling in Medicare. Enrollment is voluntary. Your opportunities to enroll are limited. You should plan on spending about as much time to make this decision as you would to choose a cable provider or streaming service. Well, maybe not that much time!
Enrollment may be done online. You can find complete information regarding Parts A, B, C, and D and also enroll at: https://www.ssa.gov/benefits/medicare/.
You have three opportunities to enroll:
- Initial opportunity = 7 month window around 65th birthday
- Special opportunity = 8 month period that starts when health insurance coverage becomes retirement based AND you are 65
- General enrollment = January – March each year; becomes effective in July (when payment begins) Possible late penalty for delaying Part B enrollment – a permanent penalty.
Do you need Medicare if you are already covered by some form of health insurance? It depends. There are several main factors to evaluate. There is the cost/benefit factor: will you gain more in benefits than you will pay in premiums? What is your health status? When making this decision at age 65 you might be in relatively good health, but think ahead to what your health might be at age 85.
Medicare Part A enrollment is free. However, you pay Medicare taxes on earnings, essentially pre-paying your premiums for when you are retired (without taxed earnings) and covered by Part A.
Medicare Part B enrollment is not free. The premium is based on your prior two years’ adjusted gross income on your Federal tax return. It is determined EVERY year. If married and filing jointly, the TOTAL income is used for both you and your spouse’s premium determination. You will find more information at: https://www.medicare.gov/index.php/your-medicare-costs/part-b-costs.
The cost for a Medicare Part C plan (Medicare Advantage plans that operate like A and B combined) is equal to that of Part B and possibly more if the plan offers additional coverage. The cost for a Part D (drug prescription) plan enrollment will depend upon your plan choice. Complete information related to costs can be found at: https://www.medicare.gov/your-medicare-costs/medicare-costs-at-a-glance.
But there is more to know than just premium costs. Equally important is knowing how Medicare can coordinate with other health insurance coverage you might already have. An excellent publication that explains how Medicare coordinates payment with all insurers may be found at: https://www.medicare.gov/media/4311.
Medicare works well with the Federal Employees Health Benefit Program (FEHB). Your incurred expenses will be coordinated with Medicare, considering all of your health insurance coverages. See more information at: https://www.opm.gov/healthcare-insurance/healthcare/medicare/coordination-of-medicare-and-fehb-benefits/. If you are a retired FEHB participant, some carriers share some of the cost savings that result when you enroll in Medicare Part B, because the carrier becomes the secondary payer. See Section 9 of any FEHB plan brochure to learn what a particular carrier might offer. Whether you are an active employee or retired FEHB participant, if you also have Medicare Part A and are hospitalized, the coordinated coverage of your costs will result in your having virtually no out of pocket costs. If you have seen a recent hospital bill, that’s really something to consider.
TRICARE health care program enrollees may have both a Medicare and some type of TRICARE enrollment. Coordination of payments between TRICARE and Medicare depends upon whether you have active military status. For full TRICARE information, see: https://tricare.mil/Plans/OHI.
You have your work cut out for you, but you have excellent resources to help you in making your Medicare enrollment decision. Don’t miss the opportunity, or it might cost you dearly!
Maureen Wilkin retired from the Federal Government after 25 years of service after being involved with employee benefits and training for over 20 years. Her last position was with the Federal Trade Commission as the Benefits Officer. She provided counsel to employees for all benefits programs. She worked with managers and employees to resolve complex retirement and benefits issues. She is a Federal Benefits Specialist and webinar presenter for NITP.