Choosing between Medicare plans can be tricky because of the many options available on the market. What makes it a little more difficult is the fact that you are at retirement age. Whether you are still working or are retiring, the type of Medicare plan you choose will be different. For Medicare at 65, here are the considerations to make for your retirement.
Medicare at 65 if Continuing to Work
The first and most important thing you need to do when deciding on Medicare at 65 if you are continuing to work is talk to your employer benefits provider. If you have employer coverage, you are not required to enroll in original Medicare. However, certain employers may require enrollment in Parts A and B.
You can enroll in Medicare Part A automatically because there is no monthly premium and you receive hospital coverage. However, Part B includes a monthly premium for other medical expenses. You want to review what coverage you currently have, how much you are paying for it, what Part B offers, and what the additional cost will be.
If you decide to delay enrolling in Medicare Part B or other supplemental plans because of employer-provided insurance, be sure to keep records of your coverage. You will need to prove that you had prescription drug coverage after you turned 65 to enroll in additional Medicare programs.
For those who are paying for their healthcare on individual plans, not employee-sponsored plans, enrolling in Medicare Parts A and B can actually save you money. A Medicare health plan can provide the coverage you had previously at lower premiums. You will also want to consider the supplemental plans including Medigap, Medicare Part D, and Medicare Advantage. These additional plans can provide more coverage without huge jumps in your payment. Speaking with a Medicare expert will help you make the best decision when moving from an individual healthcare plan to Medicare.
Medicare at 65 if Retiring
If you are planning on retiring the same age you are going to receive Medicare, you can receive Original Medicare and explore the supplemental plans to find the perfect coverage that matches what your employer was providing and more. There are a couple of factors here to consider to decide when is the best time to enroll in Medicare at 65.
- If you are retiring with an employee plan, you want to time your retirement with either your IEP or the open enrollment period. The IEP (Initial Enrollment Period) is the three months before your 65th birthday, the month of your birthday, and the three months afterwards. Open enrollment runs from October 15 through December 7. Be sure to enroll a little earlier than your retirement date to ensure there is no gap in your coverage.
- If you have an individual healthcare plan, it is best to enroll during your IEP, preferably in the three months before your 65th birthday. This means your coverage will start on your birthday month and you can start saving money.
Another thing you have to think about is your spouse and/or dependents and if they are on your healthcare plan. If they are younger than 65, there is a possibility they are eligible for COBRA benefits once you end your healthcare plan and switch to Medicare. Speak with an insurance professional to learn more about COBRA coverage for your family.