Newly eligible
individuals can apply online, but some older workers who lose their jobs can’t
May 28, 2020 By Mary Beth Franklin
As an
increasing number of Americans continue to work beyond the traditional
retirement age of 65, many have delayed enrolling in Medicare as they continue
to enjoy employer-subsidized health insurance. But now that more than a million
older workers have lost their jobs — and their health insurance — many are
finding that trying to enroll in Medicare during a pandemic is complicated.
The
unemployment rate among people age 65 and older quadrupled
between March and April, from 3.7% to 14.7%, according to the
Kaiser Family Foundation. More than 1.2 million adults age 65 and older lost
their jobs in March and April and in many cases, their health insurance, too.
Although
this group of unemployed workers is eligible for Medicare, delayed enrollment
after age 65 is normally handled by visiting one of the local Social Security
field offices, which have been closed to the public since March 17 as a result
of the pandemic. Medicare is managed by the Centers for Medicare and Medicaid
Services, but the Social Security Administration processes the applications.
“We have
seen an increase in calls from people who have lost their jobs and are looking
to go on Medicare,” said Frederic Riccardi, president of the nonprofit Medicare Rights Center, which
fields more than 20,000 questions a year through its free consumer helpline
(800-333-4114).
“People
are calling because they are confused about how to enroll in Medicare,”
Riccardi said. “It is really important to sign up for Medicare as soon as
possible to avoid any gaps in coverage and lifetime late enrollment penalties.”
Most
people can use the online
application to apply for Medicare to enroll in Parts A and B
during their initial enrollment period, which begins three months before their
65th birthday, includes their birthday month and extends three
months after their 65th birthday.
Medicare
Part A covers in-patient hospital costs and is premium-free to anyone who has
earned the minimum of 40 quarters of coverage and paid FICA taxes during at
least 10 years of covered employment. Spouses are also eligible for
premium-free coverage. Medicare Part B covers outpatient services and has a
monthly premium, currently $144.50 per month in 2020. High-income beneficiaries
pay more.
Many
people enroll in Part A at 65, even if they continue to work, because it is
premium-free.
In most
cases, people who miss enrolling in Medicare Part B during their initial
enrollment period face lifelong
delayed enrollment penalties of 10% per year for every year
they were eligible to enroll but did not.
But there
is one major exception to the Medicare Part B signup rule: continued group
health insurance coverage through a current employer or through a spouse’s
current employer. People who have “creditable” group health insurance can delay
enrolling in Medicare penalty-free for up to eight months after that employer
coverage ends by taking advantage of a special enrollment period.
The
challenge is how to sign up for coverage during a special enrollment period
when the Social Security offices that take the applications are closed.
The
Social Security Administration offers the following guidance:
“If you
are already enrolled in Medicare Part A and you want to enroll in Part B, you
cannot use our online application. Please mail your completed application form
for enrollment
in Medicare Part B Medical Insurance to your local Social Security
field office. You can find the address and phone number for your
local office based on your zip code at https://secure.ssa.gov/ICON/main.jsp.”
Normally
if you are applying for Medicare Part B as part of a special enrollment period
as a result of losing group health insurance, your employer has to attest that
you had creditable health insurance during the previous eight months. Given the
pandemic, federal officials are allowing applicants to fill out that form on
behalf of their employer and submit proof that they had health insurance, such
as income tax returns that show health insurance premiums paid, W-2s reflecting
pretax medical contributions or pay stubs that list health insurance premium
deductions.
The
Medicare Rights Center recommends that you send your paperwork to your local
Social security office by certified mail so you will have a receipt and
confirmation that your form was delivered in case you encounter any problems
with your enrollment. If you speak to anyone at your local office, record the
name of the representative you speak to and the date and time of the
conversation. And if you experience difficulties with your local Social
Security office, such as being told your enrollment cannot be processed, ask to
speak to a supervisor. If that doesn’t resolve the problem, contact your
congressman for help.
There is
another complicating factor when it comes to losing a job and employer-provided
health insurance. In some cases, unemployed workers can continue their group
health insurance for 18 months under COBRA, usually
paying the entire cost of the premium, both the employer and the employee
portion. But COBRA and retiree health plans aren’t considered coverage based on
current employment. You must sign up for Medicare Part B within eight months of
losing employer-provided health insurance — not eight months after your COBRA
coverage ends — to avoid delayed enrollment penalties.
For more,
check out Mary Beth Franklin’s Retirement Repair Shop podcasts.
https://www.investmentnews.com/medicare-enrollment-complicated-pandemic-193382?NLID=IN-Daily-Pulse&NL_issueDate=20200528&utm_source=IN-Daily-Pulse-20200528&utm_medium=email&utm_campaign=investmentnews&utm_visit=696981
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