2020 Publications you can use!
The Q&A for the month:
Question: If someone is still employed past age 65 and are not currently getting SS – when do they have to apply for Medicare as they have heard that there are penalties for not applying within a certain time period. Isn’t it within 3 months of them losing their group health insurance coverage? Or is there a penalty (higher rate) if they don’t enroll when they are 65?
Answer: That is a very common question. This is a really good FAQ on it: https://faq.ssa.gov/en-us/Topic/article/KA-02983
There’s an initial enrollment period which is three months before the 65th birthday, the month of turning 65 and three months after. However, if someone is turning 65 and they are actively employed and have health insurance from that active employment (or are covered under spouse’s insurance who is actively employed), then we advise them to talk to their benefits department and ask, “when I turn 65, will my insurance from work continue to be primary?”. Typically, if there are 20 or more employees, the answer is yes. If that’s the case, then the individual does not need Medicare at 65. They then enroll in Medicare during a Special Enrollment Period which is an 8-month period that begins with the month employment ends or the month health coverage ends, whichever comes first. There is no penalty when they enroll during their Special Enrollment Period as long as they have been working and had health coverage the entire time prior to enrolling. We have paperwork that they need to fill out and paperwork that their employer fills out indicating they’ve been working (or their spouse) and had health coverage.
If someone wants Medicare when they’re 65, they can apply online when they are at least 64 years and 9 months old. Sometimes individuals want to sign up for Medicare Part A only, even if working, because there is no premium for Part A. However, if they have a Health Savings Account (HSA), if they sign up for Medicare, even just Part A, they can no longer contribute to their HSA once Medicare begins. Check out Your Retirement Checklist for more details.
My next public retirement planning webinar is Tuesday, March 24 at 7pm EST.