What if you're turning age 65 (which makes you eligible for Medicare) and currently have group health insurance? That's a question that's becoming much more common as people are finding that they have to (or want to) work past age 65. The recent trouble in the market is probably not going to help much as people rethink timelines for retirement. Let's take a look at what you need to consider when turning age 65 while still being offered group health insurance.
First, a quick caveat. Everyone's situation is different when it comes to group health insurance so it's important to discuss your particular options with a licensed Medicare supplement insurance. We'll definitely try to cover some broad strokes and provide general guidance which address the bulk of concerns when in this situation. The first step is figure out your options.
A great deal of this decision comes down to how rich your current group health insurance is and what it costs you. If you have really rich benefits at very low (or no) cost to you, it probably makes sense to stay on your group health insurance. Keep in mind that leaving group health insurance is a qualifying event for guaranteed issue Medicare and Medicare supplement insurance when you leave (with a given time window of course) so you generally do not have an issue in terms of qualifying if you remain on the group health plan. There can be penalties for delaying to sign up for Part B with Medicare depending on your particular situation so that is something to double check. Part B is needed in order to get a Medicare supplement so this is an important consideration. Let's assume you're not one of the lucky (increasingly rare) ones that has great coverage at no cost. How do you compare your existing coverage and what's available with Medicare? Good question and there's no easy answer.
First, you need to write down the basics of your coverage: deductible, copay, RX coverage, max out of pocket and of course, your monthly (or better yet, annual) premium. Next, find out what your Part B will cost you. Part B is the part of Medicare that pays for physician costs. You generally will not have to pay for Part A (not yet, anyway) which is for facility based care but Part B will cost most people a monthly premium. Find out what this will be from the medicare.gov site or from Social Security. Most of this information can be found on the website these days once you register. That's the first step. Assume that your Part B payment will increase over time as Medicare is strapped and will be for decades. Part B is currently means tested which means that your income will figure into your cost. Next, find out what a Medicare supplement insurance plan will cost you. Run a quote on the F plan since that's the most popular (and in our opinion, best valued) plan. We can help you quote many different, strong carriers in your area to make sure you get the best Medicare supplement quote available. We're almost there. Now, we need to also find out what the cost will be for Part D which address medication cost. We can also help with this. So those are the cost inputs to look at. What about benefits?
With Medicare and an F plan, you can expect very little out of pocket expense for health issues. There will be some cost sharing with medication through Part D but most group health plans have very similar benefits anyway so that's probably negligible. As with all things pertaining to health insurance, it comes down to your preference of a cost/benefit mix. The group may be richer but cost more. Your preference may be to reduce this cost and absorb more risk. Again, this is personal preference.
Another important consideration is dependent coverage. What if you're spouse is on the group plan under you as the primary insured? This brings yet another wrinkle into play. If they're in good health, you may be able to get individual/family insurance for them and then go on Medicare (assuming it makes financial sense). If they have health issues, they may have a Cobra option but only to 18 months (sometimes 36 months). This may change in 2014 but you can expect the cost to change as well (higher). Again,
there are many considerations when looking at Group coverage versus Medicare. Of course, we're happy to help go over your particular situation when you run your Medicare supplement quote.