Hustling at 65
Options For Those Working at 65
I’m turning 65 and still working, what should I do?
This is a question I get asked almost every single day. I’ll try my best to answer the most common situations, but as always, there are exceptions and situations that I can’t fully address in a blog post. In short, the answer depends on your unique situation.
Each person’s circumstances will ultimately determine whether to begin or delay (Part A) and/or enroll or delay (Part B) of original Medicare.
I usually start by asking the following questions:
First, is your spouse covered by your employer plan? If they are, what’s the premium? What’s the premium for an equivalent individual plan? Do they have access to coverage by their employer? Compare the premium differences along with the out-of-pocket costs. If you drop the employer plan to move to Medicare while still working, then this isn’t a qualifying event and Cobra won’t be offered to your spouse. If you’re retiring and moving to Medicare, then your spouse will be offered Cobra.
Next, are you taking Social Security or delaying? This goes hand-in hand with are you funding a Health Savings Account (HSA)? If you take Social Security, then you’re automatically enrolled into Part A. If you’re receiving Social Security and enrolled in Part A, then you can’t fund a Health Savings Account that’s in your name. If you want to continue to fund your HSA, you must delay Social Security and not enroll in Part A.
Does your company have less than 20 employees? If they do, then the rules state Medicare will be primary when you turn 65. It’s best to enroll in Part A and Part B in the three months prior to your birthday month. If you don’t enroll in Part B by the time you turn 65, then the employer plan will only pay for services that are covered by Medicare – meaning care that was once covered by your employer plan may no longer be covered if Medicare Part B wasn’t in place and didn’t pay first. This could cause a serious financial burden that could have been avoided.
To me, Medicare is far easier to understand than any employer or individual health plan. The areas that typically confuse people are with exceptions and situations that aren’t straightforward. Particularly, the exceptions are what make it difficult when reading the latest version of the Medicare and You booklet. For further information on anything Medicare related, visit www.Medicare.gov.
So, you’ve decided to come off the employer plan and enroll in Medicare Parts A and B, now what? Another topic for another time, but the ‘A’ team has answers!
- Health Savings Accounts: Your Healthcare 401(k)
- The Group vs. Individual
- Redefining the Participant Expereince
- 401(k) Plan Coverage- What's Required?
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