If you will be turning 65 and eligible for Medicare, will you need Medicare insurance if you have retiree coverage through a company that you retired from? If you do need Medicare, here’s how Medicare could work with your retiree coverage?
Retiree insurance
is a form of health coverage an employer may provide to former employees. Retiree insurance is almost always
secondary to Medicare
, meaning it pays after Medicare and may provide coverage for Medicare cost-sharing, like deductibles, copayments, and coinsurance.
Because retiree insurance is secondary, you should enroll in Medicare to be fully covered. If you do not enroll in Medicare, you will likely be without primary coverage, and will face a late enrollment penalty and gaps in coverage if you try to enroll at a later date.
Deciding whether to keep retiree coverage after you enroll in Medicare is a personal one that depends on your costs and anticipated health care needs. Retiree coverage premiums can be costly, but it may be worthwhile to keep your plan if you anticipate high Medicare costs.
Retiree coverage may also pay for care or other items and services that Medicare does not cover, such as vision care, dental care, and/or off-formulary or over-the-counter prescription drugs. If the plan offers prescription drug coverage that you like, find out if the coverage is
creditable
and if you can delay Medicare Part D enrollment without penalty.
For more information on the services covered by your retiree insurance plan, contact your benefits administrator or you employer’s human resources department.
Retiree insurance may coordinate with Medicare
differently depending on the type of plan you have. Below are a few common types of plans and how you might expect them to work with Medicare. Be sure to speak to your employer’s HR department for more information.
- Fee-for-service (FFS) plans pay for care from any doctor or hospital. FFS plans cover Medicare cost-sharing and generally act like a supplemental insurance policy.
- Managed care (HMO or PPO) plans require that you see in-network providers and facilities. Your costs are typically lowest when seeing providers who take both Medicare and your retiree insurance. When seeing Medicare providers who do not take your retiree insurance, you will pay regular Medicare cost-sharing amounts, and your retiree insurance may not pay at all.
- Employer-sponsored Medicare Advantage Plans offer Medicare-eligible individuals both Medicare and retiree health benefits. Some employers require that you join a Medicare Advantage Plan to continue getting retiree health benefits after becoming Medicare-eligible. You can always choose not to take your employer’s coverage and sign up for Original Medicare or a different Medicare Advantage Plan, but keep in mind that you may not be able to get that retiree coverage back if you want it at a later date.
- Employer-sponsored supplemental insurance offers secondary coverage for Medicare-eligible individuals. These plans often function similarly to Medigaps, meaning that they pay all or part of certain remaining costs after Original Medicare pays first.
- Remember: You can always choose not to take your employer’s coverage and sign up for a Medicare Advantage Plan or a different Medigap, but you may not be able to get that retiree coverage back if you want it at a later date.
ARTICLE TAKEN FROM: Marci newsletter @ 2020 Medicare Rights Center
