Are you 65 or older and tick off all the boxes to get the social security retirement benefits? Then read further to analyze the options which will further reduce your expense and get you covered by the social security retirement benefits.
Being 65 or older makes you eligible to attain employer health insurance; in other words, you can sign Medicare right now to reduce those extra medical expenses. Millions of Americans have availed of this opportunity. According to the Bureau of Labor Statistics, Americans whose age is between 65 to 74 but are still working will be 30.2% till the year 2026.
There are many social security retirement benefits that an average American receives once he/she is eligible for retirement benefits, but Medicare is a bit different as there are a lot of hidden expenses that can arise while you think you are covered. These surprise expenses can be easily covered. Let’s have a look at how to enroll for Medicare and avoid the late-enrollment penalties for people who are 65 plus but are working.
Is Medicare enough to cover everything?
If the current employer is asking for a large chunk of premium under the name of group health insurance, then in that matter you will find Medicare cheaper and the coverage will be modestly enough for you!
You need to assess your complete coverage along with the other medical expenses such as the premiums, coinsurance, and copays, deductible costs along with the costs and benefits that you can attain under the banner of Medicare; which will also be paying some of the expenses that are not covered by the group insurance.
Medicare: Part A- free for everybody, avail it
If you are 65 years old and have worked almost 10 years of your career, you are entitled to receive Medicare: Part A which is premium-free. It pays mostly for the hospital charges etc.
So the question arises; why should one apply for Medicare: Part A insurance when the employer is already providing good health coverage at a cost lower than Medicare? Well, the simple answer is in some cases, Medicare: Part A covers your health insurance which the employer might not be able to.
There are certain aspects attached to Medicare that are unforeseen and potential pitfalls for retirees.
For instance, if you have not enrolled in Medicare: Part A by the age of 65 and have neglected to sign up till eight months of stopping the work or have lost the employer’s health coverage then you may have to pay a penalty. To avoid such a situation, it is advisable to sign up for Medicare: Part A as soon as you are eligible to avail of it.
It is also important to understand completely how your health coverage will work if the employer coverage dries out and you have not signed up for Medicare: Part A.
Medicare: Part B- delayed sign up to avoid premiums
If you are eligible for Medicare by reaching the age of 65 but your spouse’s employer’s health coverage gets you covered as well then you may want to delay enrolling into Medicare: Part B. Part B usually pays for the medical examiners’ fees and any other outpatient services which might be required by the person.
The pitfall to avoid here is that if you have HSA and are making contributions then it is advisable to delay Medicare: Part B; as part B is not free like part A. You must file for Medicare: Part B just a month before you are about to lose your employer’s health coverage.
The potential penalty is that you need to sign up for Medicare: Part B at least 8 months within the stoppage of working or losing the employer coverage. As it is a premium-based plan, if you fail to do this then you will have to pay a hefty penalty along with the premium amount – for the rest of your life.
In certain conditions, you have to enroll for Medicare: Part A and B immediately when you turn 65 years old. For instance, if you or your spouse has COBRA or retiree health coverage then enroll in Medicare immediately or if you have served in military service or are a veteran having health benefits such as TRICARE or CHAMPVA then you are to be enrolled with the Medicare system immediately to avail the social security retirement benefits.