If you work in or have recently retired from the business world, you are likely enrolled in a group health plan. As Medicare eligibility approaches, it’s important to start thinking about the transition from employer group coverage to a Medicare plan.
All too often, eligible individuals make costly mistakes when transitioning to Medicare from group coverage. Keep reading to make sure that you avoid these common mistakes.
Mistake #1: Overlooking Penalties
Start by familiarizing yourself with the differences between the insurance coverage options that you currently have.
First, you should be aware that COBRA doesn’t count as creditable coverage. If you’re enrolled in COBRA coverage and are eligible for Medicare, you could face penalties for not enrolling within 8 months of turning 65 or leaving group coverage. If you find yourself in this category of coverage, be sure to enroll in Medicare Parts A & B to avoid penalties.
In contrast, some individuals might be in employer-sponsored healthcare plans that are not penalized because they are creditable for Medicare.
A Licensed Insurance Consultant can help you review your current coverage to ensure you don’t incur costly penalties.
Mistake #2: Planning to contribute to an HSA after age 65.
Don’t plan to be able to continue to contribute to your Health Savings Account.
When you enroll in any type of Medicare – Part A, Part B, Part C, Medicare Advantage Plans, Part D, or Medicare Supplement Insurance – you become ineligible to continue contributing to your HSA. You lose eligibility to contribute on the first day of the month that you turn 65 and become enrolled in Medicare benefits.
Don’t worry, though, you can still use any funds that you have in your HSA account for qualified medical expenses.
Concerned about paying for healthcare costs once you’re no longer able to contribute to an HSA? A Licensed Insurance Consultant can help you find cost-saving Medicare options.
Mistake #3: Not accounting for employer size.
If you’re still working and have employer-provided healthcare benefits, your company size will determine how you approach Medicare.
Few than 20 employees:
- You may need to enroll in Medicare Part B even if you wish to maintain your insurance through your employer instead of Medicare.
- Medicare Parts A and B will pay before your other coverage.
20 Employees or more:
- You’ll need to work with your Human Resources department to determine how your healthcare coverage will work with your Medicare benefits.
Mistake #4: Not getting help to understand your options.
Avoid all of these mistakes and more by discussing your situation and options with an insurance professional who is skilled in understanding Medicare.
Our Licensed Insurance Consultants understand the ins and outs of enrolling in Medicare whether you’re working or retired. We can help you through every step of the way – at no cost to you. Schedule an appointment to start making the transition to Medicare.