You’re 65 and Working: What about Medicare?Posted by Medicare Made Clear
Retirement used to be closely linked to turning 65. No more. The full retirement age — when you can receive 100% of your social security retirement benefit — is 66 for anyone born in 1943. And, it’s 67 if you were born in 1960 or later.
However, Medicare eligibility still begins at age 65, even if retirement does not. People on disability could be eligible for Medicare before they turn 65.The question is: What do employed 65-year-olds do about Medicare
Medicare Before You Retire? Maybe
If you or your spouse is working, then you may have health insurance through an employer. It’s important to understand how Medicare may work with your existing insurance.
Before you do anything about Medicare, you need to talk with your employer health plan administrator. Questions you may want to ask include:
- What kind of health plan do I have? For example, many employer plans are HMOs (health maintenance organizations).
- Does my employer require that I enroll in Medicare?
- How would my health insurance change if I enrolled in Medicare?
- How much is deducted from each paycheck for health insurance? (Remember that you do not pay taxes on payroll deductions for health insurance. You need to consider the tax savings to determine the total value.)
This information may help you evaluate your Medicare choices and decide what’s best for you.
Enroll in Medicare Part A? Probably
Most people enroll in Medicare Part A (hospital coverage) when they turn 65, whether they are working or not. This is because Part A is premium-free for most people. You earn this benefit by paying into the Medicare program while you’re working. You qualify for premium-free Part A if you or your spouse contributed to Medicare for at least 10 years.
In general, hospital expenses are covered first by your employer health plan. Medicare Part A is the secondary payer. It’s a good idea to enroll in Part A as soon as you’re eligible, so you don’t have to worry about signing up later.
There may be reasons to delay Part A, such as if your employer health plan is a Health Savings Account (HSA)—employer contributions could stop if you have Medicare. It’s very important for you to learn how Medicare may change your employer health benefits.
Enroll in Medicare Part B? Depends
Medicare Part B (doctor and outpatient coverage) charges a premium. In 2016, the monthly premium starts at $121.80 per month for new enrollees. It may be more for people with higher incomes.
Many people who have employer coverage delay enrolling in Part B to postpone paying the premium. You can sign up later during a Special Enrollment Period without penalty.
Part B may be of limited value when you have other health insurance. Exceptions may be people who are self-employed or who work for an employer with less than 20 full-time employees, since Medicare would become the primary payer in these situations.
It’s very important to find out how Part B would work with your employer plan before making your decision.
You have a number of Medicare decisions to make when you become eligible for Medicare. This is especially true when you have other health insurance. You may want to start learning about your choices ahead of time. Preparation may help you avoid unnecessary costs.
For more information, explore MedicareMadeClear.com or contact the Medicare helpline 24 hours a day, seven days a week at 1-800-MEDICARE (1-800-633-4227), TTY 1-877-486-2048.