As inflation and a rocky stock market continue to eat away at the nest eggs of older workers approaching retirement, working longer than expected is increasingly being considered. However, a recent Allsup survey showed that one-third of those nearing retirement age (62-64) who plan to keep working past 65 ask the question, “Can I enroll in Medicare while I’m still working?” . The good news is that they can sign up for what is often more affordable Medicare coverage, even while they’re still employed. Beck & Lenox Estate Planning and Elder Law finds this short article full of good information for you.
Kiplinger’s recent article entitled “Yes, You Can Sign Up for Medicare While You’re Still Working” says with retirement perhaps further away for many, some people need help understanding their options. The article gives answers to some common questions concerning retirement postponement and Medicare coverage, including common misperceptions.
When should I plan to retire? Your retirement decision is personal and depends on your situation. Most employees now expect to retire around age 71. Workers in their 60s have been making the decision to work longer. Although some are relatively positive about working past 65, about 50% of those people have continued working primarily to maintain their health insurance. Access to health coverage is one of the primary reasons why the average age when people retire is going up. In a survey of more than 1,000 American older workers, 31% of those with employer insurance say health care is their main reason for working, and 53% say it’s one factor. In any event, having a plan in place for how you’ll handle your Medicare decisions before you turn 65 can streamline the transition off your employer-sponsored health insurance.
Do I have to enroll in Medicare while I’m still working? For most working seniors, the answer is no. While enrolling in Medicare is often a good alternative to their company’s coverage, it’s not required that all seniors make the jump as soon as they turn 65. However, in some cases, it’s mandatory, and it’s important to understand these exceptions to be sure there are no gaps in your coverage. One example is that in companies with less than 20 employees, Medicare becomes the primary payer, forcing a 65 year old to sign up for that coverage as soon as he or she becomes eligible. There are also penalties for late enrollment.
Is Medicare better than my employer-sponsored coverage? Employees who are approaching retirement, and those who have reached retirement age, say they’re mostly content with their employer health benefit packages. However, hesitation and misconceptions about Medicare prevents workers from shopping for potentially better plans. If Original Medicare is unaccompanied by a prescription drug plan (Part D) or a Medigap supplement, it may not match your current employer-sponsored level coverage. It’s recommended to pair your Original Medicare plan with a prescription drug plan and a Medigap plan. Each Medigap plan (plans A to N) offers a different level of coverage. You should carefully consider which plan best fits your needs. There are also Medicare Advantage plans which are very popular because many of them have no premium vs. the premium you are paying with your employer plan. And Medicare Advantage plan premiums usually stay at $0 or at a low premium vs. employers’ plans which often go up on an annual basis.
Beck & Lenox does not sell health insurance, but we refer to reputable agents who can assist you. Most importantly, we can help make sure your estate plan is in order as you get ready to retire. Having good health insurance and a plan for asset protection and asset distribution when the time comes, leaves you in a much more secure position to enjoy the rest of your life. For help, schedule a free call with one of our attorneys here.
Reference: Kiplinger (Oct. 11, 2022) “Yes, You Can Sign Up for Medicare While You’re Still Working”