After the article What is a Secondary Driver from Medicare/August 20, 2022, we received more questions about options when turning 65. Here is an excellent diagram of how this works.
Baby-boomers are 65 with an average of 10,000 new Medicare recipients per day as of 2018. Plus, we’ve had more working adults over 65 than we’ve had since Medicare was created in 1965 but then came Major resignation, with some new Medicare beneficiaries moving from commercial to Medicare. Others retain their spouse’s business coverage and are covered by this plan. This means that people over the age of 65 have options with their insurance. Let’s walk through some options as we develop a spreadsheet to complete the comparisons below.
Decision points and related research to aid decision making.
People also read…
Employment: Continue with your employer-sponsored insurance plan.
What is your monthly premium? What is the deductible and co-pay for services? What do you pay for drug benefits – generic drug options? What is your cap with out-of-pocket costs?
Stop your employer-sponsored plan and switch to conventional medical care.
What would traditional Medicare premiums be? Part B/Outpatient, Part D/Medications and optional and supplemental insurance to cover deductibles and co-pay when using services? What is the out-of-pocket cost without supplement for Part A/Inpatient Hospital and all outpatient services/Part B when using it? You must include your personal health history as well as historical use to make an estimate. How much will you pay for your prescribed medications – as this can be a big difference depending on the medication? on me MyMedicare.govThere is a free brochure, “Medicare and You,” with an excellent outline of the services and resources that are included in traditional medical care.
Stop your employer-sponsored plan and switch to Medicare Advantage/Part C.
The costs will be different from the costs of traditional Medicare but there will still be a Part B (covering doctor visits, outpatient hospital and durable medical equipment) monthly premiums with monthly Part D (prescription medication) premiums included in the Part C monthly premium. Each Medicare Advantage plan has its own coverage packages and monthly premiums.
Note: If you decide to continue with the employer-sponsored plan, you can still add Medicare Part A at no cost to the employer-sponsored plan. Medicare will become your “secondary payer” because you still work and have an employer-sponsored plan with your employer insurance plan being primary. Once you retire, even if you have the benefit of your employer’s retirement insurance, Medicare will become standard.
Summary: Depending on the monthly premiums, deductibles, and co-payments of your current employer-sponsored insurance plan — and your current health status — review Medicare options. Pay close attention to drug benefits with your employer plan as all Medicare plans have “tiers” of drug coverage – more expensive drugs can usually have much higher co-payments. There is also an annual enrollment period after your first/65 period so you can re-evaluate what works best for you each year.
Do your happy dance as you turn 65 and explore your insurance options! yes!