How many candles were on your last birthday cake? For those approaching 65 and still employed, fully understanding Medicare options available from the federal health insurance program is crucial.

If it’s time to start preparing for Medicare, you’ll find answers to some of the most common questions below.

How do I compare my group plan to Medicare coverage?

If you’ve been satisfied with your company’s group insurance throughout your career, you may be hesitating to make the transition to Medicare. Knowing your options is the first step.

Medicare coverage can be broken down into the following four categories.

• Medicare Part A covers inpatient hospital care, stays in nursing facilities, and other hospital related claims.
• Medicare Part B covers doctor and lab services, preventative care, screenings, and other medical claims.
• Medicare Part C is commonly referred to as Medicare Advantage and is an option for those interested in combining Parts A and B.
• Medicare Part D is prescription drug coverage.

Medicare coverage doesn’t cover everything which is why you should weigh the pros and cons of making a switch. You’ll want to ask the following questions.

Which option will…

• I pay more in premiums?
• provide better coverage for the procedures I anticipate?
• protect me in the event of a medical emergency?
• provide peace of mind when it comes to my health coverage?

Once you have the answers to these questions, it may be crystal clear which option is best for you. But if you still have questions, you may need assistance from your company’s human resources department or benefits manager to decipher the differences.

One other important factor to consider is whether your doctor will remain in network. The good news is that 9 in 10 doctors accept new Medicare patients. See if your current doctor is in-network before making a final decision.

Can I keep my group coverage and also enroll in Medicare?

If you’re still working, you have the right to remain on your employer’s insurance and waive Medicare coverage. You may also be able to enroll in Medicare as a secondary insurance while keeping your group coverage as your primary insurance. But there is some fine print to consider.

If you work for a company with 20 or more employees, you can most likely defer Medicare coverage until you retire without having to worry about penalties. But if you work for a smaller company with fewer than 20 employees, you could face penalties for life if you decide to delay coverage.

The most common way workers keep their group insurance and enroll in Medicare is with Part A, which doesn’t have a premium (as long as you worked and paid Medicare payroll taxes for at least 10 years, or 40 quarters). Should you decide to enroll in Part A, and you have a Health Savings Account, keep in mind you will no longer be able to contribute to your account, though you can still use the funds tax-free for out-of-pocket medical expenses.

I’ve heard of Medicare penalties. How do I avoid them?

When done correctly, switching to Medicare shouldn’t cost you anything (besides a possible change in premiums). There are two things you should do to prevent penalties.

Enroll by the end of your Initial Enrollment Period

This is a seven-month period determined by your birthday. For example, if you turn 65 in July, your Initial Enrollment Period would be from April-October. Signing up for Part A, Part B, and Part D for the first time by the end of the period will prevent late enrollment penalties (or properly deferring coverage if applicable).

Make sure coverage is seamless

If you’re switching to Medicare alone, you’ll want to make sure you don’t have a gap in coverage longer than 63 days between your group coverage ending and Medicare beginning.

Should I consider Medicare Part D?

Medicare Part D provides coverage solely for prescription drugs. You can enroll only in Part D or add it to a Medicare Advantage plan. Keep in mind that there is a late enrollment penalty if you don’t enroll when you’re first eligible, and there is a premium to consider. Even if you don’t currently take prescriptions on a regular basis, don’t rule out Part D coverage as other Medicare Parts have limited drug coverage.

You should consider Part D if:

• You’ve dropped your group coverage entirely
• Your group coverage leaves you paying substantially out of pocket for prescriptions
• Paying the monthly premium would save you money in the end
• You want peace of mind regarding potential future prescription costs

Medicare Open Enrollment 2018

Taking the proper steps in understanding Medicare options can be overwhelming at first. Don’t hesitate to ask your company’s benefits advisor or equivalent for assistance in making this important health coverage decision.

Medicare Open Enrollment begins October 15 and continues through December 7. This is the perfect time to make the switch to Medicare if you feel the time is right. If you’re already partially or fully covered by Medicare, you can also add or drop coverage as desired during Open Enrollment.

Visit Medicare.gov for more information on Medicare coverage and options.

Benefits Solutions Group is a full-service insurance brokerage and consulting firm.

For more information, call 630.928.0500 or visit Benefits Solutions Group customized approach.