As I was preparing for my transition to Medicare and its associated products, I had an opportunity to experience, first-hand, what so many of our clients go through. I found it both enlightening and affirming that we are guiding them as best we can.
Everyone’s circumstances are different. Depending on the specifics, certain rules apply. They must be followed — with no exceptions. Otherwise, you’ll find yourself in an administrative morass that can be difficult to resolve.
This month, I share four recommendations, as well as the potential barriers that can lead to the process becoming more complicated than expected.
#1. Start Early
Each month, we receive panicked phone calls from individuals whose perception from all they’ve heard is that they need to do something. That is not always true. We suggest thinking about Medicare at least six months before turning 65, so that you can identify whether you need to act or not.
Please, stop listening to your neighbor or friend who means well, but who does not fully understand your individual circumstance and can steer you into making the wrong decision about when to act.
This is the reason I never give casual advice about the topic of when to enroll in Medicare — some of the information required is quite personal. Individuals at cocktail parties looking for free advice are not too happy when I tell them that!!
If you do plan to enroll, three months in advance is the earliest you can start the process (four, if your birthday is on the first of the month). My birthday is in September, so I enrolled June 1.
#2. Identify Your Category
Thinking about the topic well in advance helps you identify what category you are in. That dictates what you need to do and when.
The categories are:
- No insurance right now
- Currently insured on the open market (that is, without an employer-sponsored plan)
- Currently insured through an employer or that of a spouse and, the employer has more than 20 employees and, employment is expected to continue
- Currently insured through an employer and the employer has fewer than 20 employees
- Currently insured through an employer with more than 20 employees and planning to retire at age 65.
Each category requires different processes and has nuance associated with it. By identifying where you sit, you can avoid not acting when you should or doing the wrong thing. Either can cause enrollment delays, penalties, or paying more than is required earlier than necessary.
I fell in the category of having open-market insurance, so I enrolled as soon as I could.
#3. Prepare for Enrollment
Your category determines the specific requirements for enrollment. Fortunately, in most circumstances, you can use an online tool (much easier than going to your local Social Security office!). To do that, you must have a functioning “My Social Security” account, a portal that allows you to access information about your Social Security benefits and enroll in Medicare online.
Although they are separate agencies, you will be interacting with both Social Security and The Centers for Medicare and Medicaid. Enrollment in Medicare is done through Social Security, so you need one to get to the other.
If you are enrolling in this account for the first time, be sure to use LOGIN.GOV rather than ID.me. Should you need assistance troubleshooting an enrollment that is not going smoothly, LOGIN.GOV makes it easier for a third party (like Healthassist) to get involved on your behalf.
You can create a My Social Security account at any point in your life, so don’t wait until you are approaching 65! Do it now and be sure you have a functioning username and password. I’ve had my account for many years, so I was well prepared.
#4. Conduct a Detailed Analysis
Your particular circumstances will dictate which products you enroll in and their associated costs, as well as whether you remain with an employer plan or transition to Medicare.
Additional factors to consider may include:
- The employer vs. the employee contribution toward an employer plan
- Coverage for other members of your family
- How much out-of-pocket expense you tend to incur
- The benefits of the plan (how well it covers things)
- The status of your health and how much healthcare you plan to utilize
- Where you prefer to access care
- How much choice you want
- Whether you are subject to an Income Related Monthly Adjustment Amount (IRMAA) assessed on top of your premium for Medicare Part B and Part D
In my case, Medicare and the associated products I selected cost significantly less than what I was paying for with my open-market plan. Plus, I now have more comprehensive coverage and greater choice. A win-win!
Medicare is a complicated topic and there are more decisions to be made than most people realize. Television and online advertising can feel overwhelming, and aggressive sales and marketing can lead individuals to make poor choices.
Please plan ahead, decide what is right for your individual circumstances, conduct a detailed analysis, and act when required. You may be pleasantly surprised and experience a win-win like I did!