A recent survey found that a third of those nearing retirement age (62-64) who plan to keep working past 65 don’t understand they can sign up for what is often more affordable Medicare coverage, even while they’re still employed. Should you enroll in Medicare before you retire? Beck, Lenox & Stolzer Estate Planning and Elder Law, LLC, states that there are several factors to consider.
Kiplinger’s recent article, “Yes, You Can Sign Up for Medicare While You’re Still Working,” says that with retirement further away for many, some people must get some help understanding their options. The article answers some common questions concerning retirement postponement and Medicare coverage, including common misperceptions.
Your retirement decision is personal and dependent on your situation. Access to health coverage is one of the primary reasons that the average age at which 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 primary reason for working, and 53% say it’s one factor. Whether you are continuing to work based on career fulfillment or health coverage, having a plan in place for handling your Medicare decisions before you turn 65 can streamline the transition off of your employer-sponsored health insurance.
Most working seniors don’t have to enroll in Medicare. It’s not required that all seniors make the jump as soon as they hit 65. However, there are some situations where it’s mandatory. It is important to be aware of these exceptions to ensure that there are no gaps in your coverage. If you delay your signup, you might end up paying for it: your small company’s group plan can deny your claims if they find you’re eligible for Medicare. There are also financial penalties for late enrollment, so if you work for a small company, you must be ready to make the leap to Medicare coverage, regardless of your retirement plans.
Employees approaching retirement and those who have reached retirement age say they’re mostly happy with their employer health benefit packages. However, hesitation and misconceptions about Medicare prevent workers from shopping for better plans. If Original Medicare is unaccompanied by a prescription drug plan (Part D) or a Medigap supplement, it may be less than your current employer-sponsored level coverage. Most individuals who sign up for Medicare don’t sign up for Original Medicare alone. You should couple your Original Medicare plan with a prescription drug and Medigap plan. Each Medigap plan (plans A to N) offers a different level of coverage that demands careful consideration in terms of weighing which plan best fits your needs.
Another option, aside from Original Medicare plus a Medigap plan, would be to go with a Medicare Advantage plan (Part C). Medicare Advantage plans are usually less expensive, and some plans have no monthly premiums. Your health and your lifestyle, i.e., do you travel, are factors to consider when deciding which plan to choose.
Beck, Lenox & Stolzer can refer you to Medicare agents we know, if you are in need of someone to help you answer the question, “Should you enroll in Medicare before you retire?” Schedule a free phone consultation here.
Reference: Kiplinger (Oct. 11, 2022) “Yes, You Can Sign Up for Medicare While You’re Still Working”
