Overall I like my Medicare coverage. So far it is working well and covering what we (spouse and I) need covered.
We opted for original Medicare (Parts A, B, and D) plus a Plan F supplement plan to cover things like co-pays and deductibles. We went with original Medicare over the Advantage Plan approach (Parts A, B, and C) so we could have more choice over the doctors and facilities we could use. Original Medicare is generally a bit more expensive, but it is the right choice for us.
This blog post focuses on the ins and outs of signing up for Original Medicare (Parts A, B, D, and a supplement).
Sorting through all of the details and possibilities and timelines and rules for obtaining coverage can be very daunting – not to mention confusing. And messing up can cost you extra money for as long as you have Parts B and D and could make it hard to purchase a supplement plan.
In my case, the sign-up was further complicated by the fact that I worked for a couple of years past turning 65, carried my husband (a consultant) on my employer plan, and changed jobs a few times. This meant that I needed additional paperwork to verify that we both had creditable health insurance coverage after we each turned 65 so that we would not be hit with permanent penalties for not signing up in time.
The Parts A, B, and D configuration is known as Original Medicare and generally costs more, but you have more flexibility. Any place or doctor that takes Medicare takes Original Medicare and likely some subset of the Plan C offerings in your area.
Also, you have to make sure your doctors, clinics, hospitals, and drugs are available through the plan C you choose. What’s available can change from one year to the next meaning that you have to check every year, and that you might have to change doctors, clinics, hospitals, or drugs, or look for another Plan C that includes what you need.
Part A: Hospitalization plan. No cost to have it, but there are co-pays, co-insurance, and deductibles.
Part B: Medical plan. You pay to have it, plus you have co-pays, co-insurance, and deductibles.
Part D: Prescription drug plan. You pay to have it, and will have a mix of deductibles, co-pays, and co-insurance depending on the plan you choose.
You have to make sure your Part D coverage includes your medications. You have to check your medications every year to make sure your current Part D coverage still carries the medications you need. If not, you need to change plans, but your Part A, B, and supplement coverage do not change.
Supplement (Medigap): An array of supplement plans with different levels of coverage and costs are sold by private insurance companies. Supplement plans are strictly regulated by the Federal Government so that the offerings are all the same. The only differences are the following:
- Cost varies from company to company
- Quality of service varies from company to company
See What’s Medicare Supplement Insurance for more information and where to get more information.
This section briefly covers the general rules for singing up for Parts A, B, D, and the supplement. The goal is to state the order of things in simple terms and point out potential penalties if you miss the dates.
Before you do anything, check the medicare.gov site or the Medicare & You publication for the specifics. There are a number of special cases with different timelines. If you fall into a special case, the information provided here might not be completely accurate.
No Employer Insurance: If you don’t have employer insurance, you need to sign up for Parts A, B, and D during the 7-month period that begins 3 months before you turn 65.
Employer Insurance: If you have employer insurance, you have the following options:
- Wait until you are no longer working, and sign up for Parts A, B, D, and supplement during your special enrollment period (SEP).
- Sign up for Part A while you have the employer insurance and refuse Part B. If you do this, you are not required to sign up and pay for Parts B and D and a supplement plan.
When Employer Insurance Ends: Once your employer insurance ends, you have 8 months to sign up for Parts A (if you didn’t sign up while you were working), B, and D without penalty.
Having COBRA insurance from your employer does not change the enrollment dates. If you miss the deadline for signing up for Pars B and/or D, you will have to pay a penalty for as long as you have the coverage.
Supplement Plan: You can choose and sign up for a supplement plan during the 6 months that begins on the first day of the month in which you are 65 or older and enrolled in Part B. If you miss the deadline for signing up for a supplement plan, the private supplement companies do not have to sell you a plan if they don’t feel like it.
Working Past Age 65
When my husband and I turned 65 (4 years apart), I was still working and had employer insurance. We each separately went to the social security site and signed up for Part A and refused Part B because of my employer coverage. I was carrying him on my employer insurance.
Some years later when I decided to stop working and put us both on Medicare, we had additional paperwork to complete. Initially, we had both used the social security site to sign up for Part A and refuse Part B. I thought that all we needed to do was to each go back and activate Part B. Sounds simple, but it doesn’t work that way.
Instead, you need the following forms:
Form CMS40B: Application for Enrollment in Medicare Part B for each of us. In the 12. Remarks section, you can state when you want to start Part B, but you can’t rely on the person at the social security office necessarily reading it.
If you don’t provide a date, or if you do and they don’t notice it, you are signed up for the following month. If they receive your application at the end of a month, you are signed up for the month after the following month.
The safest way to sign up if you want a specific start date that might be 2 or more months out is to prepare this form and gather the CMS-L564 forms from your former employers (see below) and take them into the social security office to do the sign-up in person.
Form CMS-L564 : Request for Employment Information for each job where I worked starting from when my husband turned 65. Between then and when I signed us up for Medicare, I had worked at 3 companies. So I needed CMS-L564 for him for my last 3 companies, and CMS-L564 for me for my last 2 companies. You fill out Part A and get the HR department of each company to fill out and sign Part B.
If the company has it’s own HR department, this can all be done electronically (email them the form, and they email it back with Part B filled out and signed). If the company has outsourced it’s HR to a third-party, it has to go through snail mail (email or snail mail the form, and they snail mail it back), which can take awhile. If you have to use snail mail, plan for it to take awhile, especially in the event there is a mistake by either you or them in terms of stating the dates or anything else.
Part D Declaration of Prior Coverage: I signed us both up for Part D over the phone with different providers because our drug needs were different. In my case, I was asked if I had prior coverage to fill in the gap between when I turned 65 and when I started my most recent job. I said yes and had to provide some information about that coverage, which the system wouldn’t take. We put it in, that I did not have the coverage just to make the application go through. I was not comfortable with this, but the person on the phone told me it would be okay.
In my husband’s case, their system took the information, so I thought we’d be fine there.
What happened in both cases is that we each got a form letter from the Department of Health and Human services, Centers for Medicare and Medicaid Services, stating that:
…. it appears we did not have prescription drug plan that met Medicare’s minimum standards.If your records show that you did have prescription drug coverage from <some date> to <some date>, you may be able to avoid paying the monthly penalty by returning the enclosed form. ….
It was easy enough to do this, except that I needed to remember the coverage I had for the last 3 jobs. I had not saved all of the Explanation of Benefits (EOBs) or my insurance cards, so I had to make a couple of calls to find out whether I had BlueShield or Prudential, for example.
So, I recommend that from the time you (and your spouse if they are on the insurance with you) turn 65, that you just save your health insurance cards if you work beyond that, and especially if you change jobs. Alternately, saving an EOB or two from each provider would also work.