When you’re first eligible for Medicare, there’s a 7-month Initial Enrollment Period (IEP). Your IEP spans the three months before your birthday month, your birthday month, and the three months after your birthday month.
But what if you don’t plan to enroll in Medicare at age 65 and want to stay on a group health plan? Well, you can do this…and WITHOUT penalty!
Here are 4 reasons why you should consider delaying Medicare enrollment:
#1 - You have group health coverage from an employer that has 20+ employees
In this case, the group health plan continues to be primary coverage, so you don’t need to enroll in Medicare Part B (medical/outpatient). You can enroll in Part A (hospital) without issue, as long as you (the HSA account owner) are NOT contributing to a Health Savings Account (HSA).
#2 - You have group health coverage from your employer that has 20+ employees…AND…your younger spouse (not yet eligible for Medicare) is also covered on the plan as a dependent
You likely want to keep your younger spouse covered as long as possible. You can enroll in premium-free Part A (hospital) coverage in this situation, as long as you’re not contributing to a HSA.
#3 - Your income is high, which would cause you to Pay a High Income IRMAA Premium for Medicare Part B (and potentially Part D)
Depending on your group plan premiums, this could make the Medicare route more expensive. The standard Part B premium in 2024 is $174.70/mo…but it can get as high as $594/mo at the top income tier. See the income chart here: https://www.medicaremindset.com/news/medicare-premiums-and-costs
#4 - Lastly, you may determine your existing group health coverage has a very strong design and/or it would simply cost more to go on Medicare
Sometimes the employer plan truly is worth keeping, so Medicare isn’t always the right choice when you turn 65.
You’re probably thinking…”Isn’t there a penalty to delay Medicare enrollment?” In a vacuum, this is true…but if your employer has 20+ employees and you’re covered in the group health plan (based on your current employment or a spouse’s current employment), you can delay enrollment in Part A and/or Part B without penalty. And don’t let anyone tell you otherwise! In this case, you will use your Special Enrollment Period option to enroll later in the future.
Reference Links
www.medicare.gov
Medicare Enrollment Periods
Medicare & Health Savings Accounts
Neither Medicare Mindset LLC nor its agents are connected with the Federal Medicare program.
