Q: I have insurance through my employer – do I need to sign up for Medicare?
A: If you are turning 65 but still covered under your employer, we recommend that you look at your options. As long as your employer has more than 20 employees, you do not have to sign up for Medicare Parts A and B. However, depending on what you are paying through your employer it may make sense to transition into Medicare. As long as you have worked for 40 quarters (10 years) your Part A has no premium, many choose to sign up for Part A even if they are still covered by their employer’s insurance.
Q: I received a Medicare Card in the mail – but I didn’t sign up for Medicare. What should I do?
A: If you are receiving Social Security prior to your 65th birthday, you will automatically be enrolled into Medicare Parts A and B. You will receive your Red, White & Blue Medicare card from Social Security approximately three months prior to your birthday. You are not obligated to accept the enrollment; however, you do need to take action if you wish to delay your Part A and B enrollment.
Q: When should I sign up for Medicare Part B
A: There is a 7-month window in which you can enroll in Medicare Part B. Three months prior to your 65th birthday, the month of your birthday, and three months following in which you can enroll in Medicare Part B.
Q: Will Medicare affect my HSA?
A: Once you are enrolled in any part of Medicare, you are no longer eligible to contribute to your HSA (nor is your employer able to contribute on your behalf). You are still permitted to use the funds you have accumulated in your HSA for approved purchases.
Q: What is the difference between a Medicare Advantage plan and Medicare Supplement?
A: Medicare Advantage plans generally offer low or no monthly premiums (must continue to pay Part B premiums). These plans operate with co-pays, deductibles, and maximum out-of-pocket thresholds. In most cases, Medicare Advantage plans have a network of doctors and hospitals you must utilize to maximize your plan benefits. Additionally, Medicare Advantage plans often include a Part D prescription plan.
Conversely, Medicare Supplements generally have higher monthly premiums resulting in lower out-of-pocket expenses. Unlike Medicare Advantage plans, Medicare Supplements do not include prescription drug coverage. Accordingly, a separate Prescription Drug Plan (Part D) is often purchased on a stand-alone basis. Medicare Supplement plans do not have designated networks of doctors and hospitals which allows beneficiaries to see any provider that accepts Medicare. Supplement plans are federally standardized, meaning that all plans offered by insurance companies are exactly the same.
Q: When can I change my Medicare Health Plan?
A: Open Enrollment is from October 15th – December 7th of every year. During that time period, you can enroll in a different Medicare Advantage or Prescription Drug Plan for a January 1st effective date. This open enrollment does not apply to Medicare supplement (Medigap) policies. You are free to switch those plans throughout the year, however if you apply outside of your 6-month guaranteed issue window you are subject to underwriting and medical questions.
Q: What is the ‘Donut Hole’?
A: Prescription Drug Plans are federally mandated to control the cost of prescriptions. However, some beneficiaries go well above the anticipated cost during the year. When the total cost of your prescription drugs in a calendar reaches $3,310 (2016 figure) the coverage gap or ‘Donut Hole’ is reached. During this coverage gap your responsibility for your prescriptions increases, typically to a percentage of the prescription rather than a co-pay. Once the total out of pocket expenses of your prescriptions reaches $4,850 (2016 figure) you reach the catastrophic coverage phase, in which your prescriptions are severely discounted by as much as 98%.