I am 65 and still working, do I stay on my group health insurance, or do I go onto Medicare? Well, not an easy question to answer as there are many factors to consider.
1. How many employees does my employer have? If more than 20 employees, I can stay on the group plan and delay Medicare until I retire. (Seems reasonable, but is it?) On the surface it seems reasonable, however, there are other factors to consider before making the final decision. (Having an HSA makes it mandatory that you go on Medicare regardless of the group size, just as an example of the complications.)
2. Part of that decision does I have dependents that need coverage. If I do have dependents what are their ages and how close are they to Medicare themselves. If there are children involved on the surface staying on the group coverage makes sense. (More about that later)
3. If my spouse is close to Medicare age, perhaps if they do not have other coverage you should stay on the group insurance until they are 65. Remember your group must have more than 20 employees to stay on the group plan. (The 20 employees under Medicare rules determine who pays first. Groups with more than 20 employees group coverage pay first and Medicare pays second. So yes, you can stay on the group plan until you retire without incurring any lifetime penalties from Medicare. If that group has less than 20 employees, then you must go on Medicare, and you will need to find individual coverage for your spouse and any underage children. In this scenario, Medicare pays first so you must go on Medicare.
4. First you determine based on the size of your employer how to proceed. Once that is determined you need to figure out the cost of these individual plans and see if they meet your healthcare needs. Less than 20 employees mean you must go on Medicare at age 65, working or not.
5. If the group has more than 20 employees, you should determine the cost of coverage to compare with the cost of Medicare. Medicare Part A (hospitalization is free but Part B costs $148.30 per month in 2021. (If income-driven so if you make more than a certain income you could end up paying a surcharge on top of the $148.30 so that must be considered as well.) Additionally, Medicare requires you have a creditable drug plan even if not taking any medications. More on that later.
6. You have determined based on group size that you should go onto Medicare or stay on your group coverage. Now what?
7. Medicare options in Clark County exceed 82 plans. You cannot determine which will be best for you, so my suggestion is to find a Medicare broker to guide you through the process. Brokers cannot charge you for their services so using them makes sense.
8. The factors to consider are really very simple yet complicated. You need to figure out if your medications are included in any plan, you pick and what is the cost of those drugs. The monthly premium must also be considered because some plans have no monthly premium while others have a monthly premium. After reviewing the medications does your current doctor take the plan. Do you even want to stay with that doctor or choose another one?
9. Once the medications and doctors are determined you should examine the plan to see if it fits your needs? Some plans work better than others so be careful. Using a Medicare broker is common sense as they cost you nothing and they have the expertise to help you figure out the best plan for you and or your spouse. (As an aside you and your spouse do not have to be on the same plan as your medical needs are usually different.) Let us compare my wife and me as an example and it will clear up some of the confusion. She has no medical issues and a Medicare Advantage plan with no monthly premiums works best for her. I have RA and need to see a specialist monthly who dispenses a very expensive medication so buying a Medicare supplement with a standalone drug plan is the most cost-effective choice for me. There is a monthly premium for my plan, but the medication is at zero cost because it is injected in the Doctor’s office so Medicare and my plan pay the entire cost. As you can see, figuring out Medicare is complicated so having an experienced broker help you makes sense. With those 82 options in Clark County, only someone familiar with those plans can guide you to the correct decision for you. Please make sure the broker you choose has the experience and the knowledge to help you make the best decision for you. Many of your friends have used brokers and can make suggestions for you. Interview them to make sure they are a fit for your needs.
The Barend Agency Inc.
Len Barend, broker