If you are older than age 65 and did not join Medicare when first eligible at age 65, because you continued working and remained on your employer’s group health insurance beyond age 65, but now you want to enroll in Medicare, here’s a checklist that you must follow to avoid the “The Medicare Confusion” blues once you join Medicare:
• Step one: Once you turn age 65 and decide to remain on your employer’s group medical insurance, ask the Human Resource person to provide you with a “Creditable Letter of Coverage”. This is important because if you do not have “creditable prescription” coverage in the group plan, and don’t join a Medicare Part D plan, you can be assessed a penalty of 1% of the average Part D premium, or about $.30 per month for every month you did not have “creditable coverage.
• What is creditable coverage?
It means that the group plan has coverage as good as or better than what Medicare Part D offers. Since enrollment in Part A (Hospital) is compulsory and you get Part A at age 65, you can buy Part D prescription coverage even though you are not enrolled in Part B (Doctors). If your letter says your prescription coverage is creditable, no worry, you don’t need to do anything except keep the letter in a file. By law, your employer must notify you every year after age 65 whether the group prescription coverage is still “creditable”. If you do not have “creditable” coverage, call me and I’ll enroll you in a Part D prescription plan, and you can continue on your group plan. The 1% penalty which in many cases has been in the $15 to $19 per month on top of the Part D premium when you actually enroll in Part D years later at age 70+or longer, stays with you for life. Ouch!
• Once you decide to leave an employer plan and join Medicare here’s what you must do:
……….. Ask your employer to provide you with the U.S. Department of Health and Human Services Center for Medicare and Medicaid services Form 0938-0787 REQUEST FOR EMPLOYMENT INFORMATION. The employer must sign the form and declare that you were covered under an employer group health plan and indicate when the coverage began and when the coverage will end. Confirmation of your work history dates must also be provided. This form must be completed before you can enroll in Part B at the Social Security Office.
………….. Once you have this signed employer form, take it with you the nearestSocial Security office and enroll in Part B at least 3 months prior to the date you plan to leave your group employer medical insurance plan.
…………once you have confirmed effective dates, contact me about your Supplement and Prescription insurance options.
………. After you have been approved for your Prescription and supplement insurance, you may receive the following letters from Medicare:
Declaration of Prior Prescription Coverage Letter inquiring about your “Creditable Prescription coverage”. You will need to complete the form and include a copy of that “Creditable Coverage” letter you’ve been saving.
A letter confirming that your application in Part D prescription coverage was approved by Medicare.
If your AGI (Adjusted Gross income) is higher than $85K for a single or $170K filing joint, then expect a Medicare Income Related Monthly Adjustment Amount Letter informing you that you will pay more for your Part B premium: The base premium for 2013 is $104.90 but you could pay as much as Warren Buffett in the $335.70 maximum per month category. The income test is based on two years prior Federal Income Tax returns. For 2013, Medicare will review your 2011 Tax Return to make the calculation.
Summary Checklist:
1. Get the “Creditable Coverage” prescription letter from your employer the month you turn age 65. If “creditable” do nothing but save it. If not “Creditable” call me and get enrolled in a Part D prescription plan to avoid the penalty down the road.
2. When you leave employment:
a. Get your employer to COMPLETE AND sign Medicare’s required REQUEST FOR EMPLOYMENT INFORMATION FORM.
b. Take the form with you the Social Security Office and enroll in Part B (Doctors) Get confirmation of your effective dates.
c. Call me,785-537-0366 set appointment to get enrolled in Supplement and Prescription coverage.
d. Once you are enrolled in Prescription and Supplement coverage, allow one month to receive your confirmation cards & policies.
e. While you are waiting (about one month) prior to your effective date into Medicare , expect the following letters.
i. “Creditable Coverage” letter inquiry from Medicare. Take action sign and return with your Creditable letter you’ve been saving.
ii. Confirmation letter from Medicare that you were approved to enroll in a Part D prescription plan.
iii. If your AGI exceeds the amounts listed above, you’ll get a WELCOME TO IRMAA Club letter. (Income Related Monthly Adjustment Amount) due on your Part B premium which will be added to the base premium $104.90 (for 2013)
That’s all folks! Hope this helps. I’ve been getting a flood of requests from those who have recently joined Medicare after age 65 and we’ve been singing “The Medicare Confusion Blues” together during our meetings as I try to unravel the maze of confusion.
Coach
