Interview: Unretiring and What it Means for Your Medicare Clients

I sell insurance. That’s the easy part. So basically, I meet with clients and figure out what their needs are just like every other agent does. I just happen to work specifically for Ritter.

It’s pretty much just like aging into Medicare. There are a couple of different things that you have to check on and verify, but pretty much the process is the same as when they went on to Original Medicare.

It’s starting to come up a lot more … I think more what you see now, what I’m seeing even more of now, is people just staying in the workforce. But definitely in the past year or two, I’ve seen a good handful of clients that said they’re heading back.

First, your client has to consider the extra income as it relates to their Medicare and Part D premiums. If they’re close, that extra money they’re going to make could push them to the higher income bracket, and then they’re going to have to pay more for their Part B, C, or D plan.

The size of the company is going to make a difference on what they’re going to do with their Medicare. If their company [has] 20 employees or less, their Medicare will be their primary payer. If their company [has] 20 employees or more, their company’s insurance could become their primary payer.

If your company has 20 or less employees, Medicare is going to be your primary payer. What that means is Medicare will pay first. If they pick up employer group health, they will pay second … They might even come out of pocket a little bit less.

The main part of it is that their Medicare will still be their primary insurance. It’ll be the one that gets billed first. They might want to figure out, monetarily, if they even want to pick up their employer group health plan, if it pays them to … or postpone Part B so they’re not getting that Part B premium if they’re going to use that employer group health.

Most of the time you can keep your Medicare coverage that you currently have. There are some times where you can’t. For example, if you were to decide to postpone your Part A, because your employer has a high deductible health plan, but they fund your HSA entirely, then you cannot have an HSA and Medicare Part A. In that case, there may be a circumstance where you want to postpone your Part A so that you can have an HSA, if your employer is going to fund the entire thing.

If you have a good prescription drug plan, that is considered creditable — in other words, it’s at least as good as Medicare — you might want to get rid of your Part D plan. If it’s tied into your Medicare Advantage plan, obviously, you can’t ditch Part D without ditching the benefits. But that doesn’t mean you can’t keep the benefits and just have extra benefits. Your employer group coverage would pay first. So, you might actually come out of pocket less for your meds if you had both plans. Sometimes you can’t, depending on the employer group coverage, you can’t have both plans.

Most of the time, you’re not going to be able to have two prescription drug plans. So, you’re going to have to choose one. You have to figure out which one’s going to cover your medications better. Again, if your employer group coverage is creditable, is it as good as Medicare’s? It has to be determined by Medicare that it’s as good as Medicare. It’s all going to lead from this question to this question. So, it’s good to talk to somebody who knows what’s going on. Your benefits administrator at your job, for example, would be a good one.

With the larger companies … your employer group health is going to become your primary payer if you choose it. That means that your employer group coverage will pay first. Medicare will pay second. In this situation, you can postpone your Part B … so you’re not paying that premium, because you’re going to get your coverage from the employer … As long as you’ve worked 40 quarters, which is 10 years, Part A is going to be free for you, so you don’t have to worry about that cost. There are times when you would want to postpone Part A … If you do you have a fully-funded HSA from your employer, then you have to postpone Part A.

Again, it’s going to depend on creditability of coverage. If their prescription drug plan is not creditable and you drop your Part D plan, you could incur a Part D penalty down the road. So that’s something to think about. Your company is going to have a lot of information on that. They’ll be able to tell you if it’s creditable.

It’s going to be pretty close to the same as the first time they retired. There are some different timeframes. They’ll get a special enrollment to Part B, which that window is eight months from the day they retire. To get back into a Part D plan, you’ll get a special election period for that. You’ll have six months from your Part B effective date to get a Medicare Supplement. Then a Medicare Advantage plan or MAPD works the same way as Part D. You have 60 days because that’s going to have your Part D coverage.

There is one pitfall and it’s something that everybody should remember. All of this is contingent on active employment. If your employer offers to keep your benefits going for a year, when you are no longer employed, that’s a pitfall. It’s nice to have the free benefits, but then you will likely incur a Part B or D penalty when you re-enroll, and you’ll have to wait until the next Open Enrollment Period.

There could be a special election period that pops in there. For example, right now we have five-star plans in central Pennsylvania for the first time ever. So, there’s a possibility you could use one, but for the most part, you’re going to have to wait until the next AEP.

And then, that plays back into the Part D coverage penalty. If you are without coverage until then, you’re going to end up incurring that penalty.

Part B penalty is 10 percent of the monthly Part B standard premium. Part D is one percent of the base premium for each month that you should have had coverage but did not … That’s a forever penalty that doesn’t go away.

For the most part, it shouldn’t because you’re going to be back in it. As far as a Medicare Supplement is concerned, you’re going to be back in an Open Enrollment situation. So, you’re going to get that Medicare Supplement with no health questions. It’s going to be, virtually, the same as aging in with some different time frames.

Keep your proof of coverage letters, your creditable coverage letters, anything you get from your employer that shows that you had creditable coverage. You want to make sure you keep those for a while. There are times when we sign somebody up that the carrier may want to see those. So definitely keep that kind of stuff that comes from employer group coverage or any insurance coverage. That way, if we need to prove something, we have it to prove.