Insurance agents have been advising Medicare-eligible clients who are still working and covered under their employers group health plan to decline Medicare Part B. There is a monthly premium for Part B coverage and since employer group health insurance plans are mostly for companies with 20 or more employees enrolling in Part B will most likely not help you very much. Technically an employee can enroll in Part B when they retire without a waiting period since they are getting termed off a group health insurance plan.
Part A is different though. When people reach 65 most of them have paid into their Medicare for long enough to receive Part A for free. People may be asking themselves why wouldn’t they take it if it was free??
Well, the reason is, enrollment in either Part A or Part B of Medicare makes a person ineligible (if they have an HSA) to continue contributing to an HSA. Seeing this many brokers might be advising you to not enroll in either A or B. However this could be bad advice.
Under the current rule a retiree who opts out of Medicare Part A gives away all past and future Social Security retirement benefits. This would mean that seniors would not receive their SS check and would be expected to repay any benefits received prior to not enrolling in Part A’s health insurance plan.
If we could hatch a bill to take Health Saving Accounts to the next level, we could change the number of Medicare Beneficiaries who continue working after 65. The current deductible for hospital coverage under Medicare Part A is very high…almost $1,200 per admission which is pretty close to the minimum deductible required for an HSA health insurance plan. This bill would allow Medicare beneficiaries enrolled only in Part A to continue to contribute to their HSA health insurance plan accounts.
For groups with less than 20 employees Medicare is primary. “If an employee is eligible for Part B, the group health plan can pay as if the employee had Medicare even though he’s not signed up. This means that the groups health insurance plan may only be responsible for 20% of the cost of Part B covered services whether Medicare is paying its share or not.”
This is just something to keep in mind if you are looking for group medical benefits in the area. As a broker we like to provide this type of information to our customers wherever you live.