For Medicare-Eligible Employees Who Are Retiring:
Part 3 of a 3-Part Series
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In the previous parts of this series, we focused on considerations for Medicare-eligible employees who opt to keep working. Here, let’s take a look at options for your Medicare-eligible employees who are planning to retire.
Most importantly, these employees should know that to avoid a penalty, they need to enroll in Medicare Parts A (hospital coverage) and B (medical coverage) within 8 months of either retirement or losing group coverage, whichever comes first. In other words, they should not wait for COBRA to end before signing up for Medicare.
Once they are enrolled in Medicare, it becomes the primary insurance, and COBRA is secondary.
For prescription drug coverage, retirees will need to enroll in a Medicare Part D as well. These plans are purchased from private companies approved and under contract with Medicare. If they decide not to enroll in a drug plan when first eligible, and they want to enroll in drug coverage at a later date, they can do so during certain times of the year. But they may have to pay a monthly “late enrollment penalty” in addition to their drug plan premium.
Medicare Advantage and Supplement plans
Because Original Medicare has coverage limits, retirees may want to consider a Medicare Advantage or Supplement (Medigap) plan. They can enroll in a Medicare Advantage plan within two months of losing group coverage (based on active employment, not COBRA). Many Medicare Advantage plans also include prescription drug coverage. If they decide on a Supplement plan, acceptance is guaranteed as long as they sign up within six months of enrolling in Part B.
Resources
Employees are welcome to contact us directly. One of our Medicare experts can consult with them about their unique situation: (855) 265-5969 or TTY (800) 735-2900.
Information on PacificSource Medicare Advantage plans:
Pacificsourcemembersfirst.com/medicare-age-in
Basic information on Medicare:
Medicare.pacificsource.com/Find/UnderstandingMedicare
The official U.S. Government site for Medicare:
Medicare.gov
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You can read the rest of our series here:
Part 1 – For Active Employees Moving from a Group Plan to Medicare
Part 2 – How Group Coverage and Medicare Coordinate
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PacificSource Community Health Plans is an HMO/PPO plan with a Medicare contract. Enrollment in PacificSource Medicare depends on contract renewal. For accommodation of persons with special needs at sales meetings call (888) 863-3637 or TTY (800) 735-2900.
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About this series
Every day, 10,000 Baby Boomers turn 65. That’s right—10,000 per day. That started in 2011 and will continue through 2030, according to the Pew Research Center. As they approach Medicare eligibility, these folks will need to navigate complex information and make important decisions about their healthcare coverage. To help you assist them, we’ve pulled together some basic info and resources into a three-part blog.
The first post in our series focuses on options for employees who would like to keep working, but move off group coverage and have Medicare only. Part 2 looks at considerations for active employees who opt to remain on your plan. And finally, part 3 addresses ways to assist employees who are planning to retire.
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