Many seniors have spent long years pursuing a career they love, and just aren’t ready to give up working and head into retirement the minute they turn 65 years of age. However, healthcare options can tend to get a bit confusing if you don’t retire at the age of 65 (which is also the age you are eligible for healthcare benefits such as Medicare). This should not be confusing if you want to continue to work and you should know how to maneuver in this situation. Continue reading to learn more about what to do if this is your case.
- Medicare Part A and postponing retirement: you can (and should) enroll in Medicare Part A as soon as you are eligible, no matter what.
- Should you enroll in Medicare Part B if you postpone retirement: if you work for a company with 20 or more employees, you have several options. If your company has fewer than 20 employees, you will likely have to choose Medicare Part B.
- Should you enroll in Medicare Part D if you postpone retirement: If you are enrolled in Part A, want prescription drug coverage, and can’t get it through your employer, you can (and should) enroll in Part D.
- How does Medicare Advantage work for working seniors: a Medicare Advantage plan will definitely replace your employer health plan, but most Advantage plans are so comprehensive that this coverage is usually the better option.
- Retiree vs. Employment Benefits: It’s possible to qualify for a Special Enrollment Period and enroll in Medicare Part B at a later date, but only under specific circumstances.
Can You Postpone Retirement and Still Enroll in Medicare?
In short, yes! Medicare is still available to those who work and it is actually recommended for workers who are above the age of 65 to at least enroll in Medicare Part A no matter what. Part A comes with many benefits for your healthcare but also for enrollment in the future. Signing up for Part A on time is the best way to secure a Special Enrollment Period for when you are ready to switch to Part B instead of an employer plan. Additionally, signing up for Part A while you are still in the workforce can still be premium-free. If you have been working for 40 quarters or 10 years, you will still be eligible for Part A at no cost. You are essentially getting more coverage, but at no extra cost.
Working Seniors and Medicare Part B
Unlike Medicare Part B, those who decide to enroll will most likely have to make the choice between working and staying on their employer’s plan or retiring and enrolling in Medicare Part B if you work for a company that has over 20 employees. However, if you do decide to enroll in Part B alongside your employer health plan, that can also be an option available to you.
If you choose to obtain both forms of health insurance, Medicare Part B would be the primary payer for your coverage. Your secondary payer would be your employer. If your employer still offers your insurance plan past the age of 65 and they have good coverage for your needs and lifestyle, putting them as your secondary payer may turn out to be more costly for you. If this is your case, you must first compare both coverage plans before deciding on enrolling to Medicare Part B. Do not enroll for Part B even if your employer offers comprehensive coverage just in the fear that you will need to pay late enrollment penalties. Many times, you can opt for a special enrollment period for Part B once you retire and lose your employer’s coverage.
Working Seniors and Medicare Part D
Just how it is recommended to join Part A despite your working status, it is also recommended to join Part D even if you decide to postpone your retirement. Part D is the plan that provides coverage for prescription drugs. To take advantage of Part D, you do need to be enrolled in Medicare Part A, but you do not need to be enrolled in Medicare Part B. Making enrollment simple for those who continue to pursue an active working lifestyle. Depending on what plan you choose, there will be a monthly premium that can vary in cost. If your employer already offers coverage for prescription drugs and you choose to continue with employer coverage, Part D may not be necessary for you.
Medicare Advantage and Working Seniors
If you have Medicare Advantage, you have a bundle of Medicare products that already includes Medicare Part A, Part B, and typically Part D as well. If you continue working and choose to enroll in Medicare Advantage it is important to realize that the Medicare Advantage plan will replace your employer’s coverage. This has the same process as if you were to get Medicare Part B alongside your employer’s coverage. However, unlike just purchasing Medicare Part B, Advantage plans come with many additional benefits such as dental and vision plans and may offer more coverage than your current employer. It is crucial to identify which plan offers you the best coverage at the best pricepoint to determine which plan you should opt for. With Medicare Advantage, you cannot dual-enroll in both Medicare and your employer’s insurance plan as you would be able to with Original Medicare.
Active Employment vs. Retiree Benefits
There are different benefits seniors may receive from being actively employed or deciding to retire. The main benefit that creates a huge impact on your healthcare plans are the enrollment period technicalities associated with both. If you or your spouse are actively employed, meaning your employer coverage does not come from retiree benefits or COBRA, then you are exempt from late enrollment periods and are assigned a Special Enrollment Period when you do decide to join Medicare Part B. If you are already retired and enjoying employer-benefits while retired, that does not count as being actively employed and if you choose to delay enrollment in Medicare, you will need to pay late enrollment penalties.
Deciding whether or not to retire or continue working is a huge milestone in your life. Be sure to compare benefits between your current employer-sponsored coverage and what Medicare has to offer to gain the biggest benefit possible and kick off your senior years the right way. If you are unsure where to start, make sure to consult a health insurance expert or Medigap.com for clarification of your benefits.