Medicare Mistake #3:
Believing You Don’t Need Medicare Part B
Medicare Part B covers services such as doctors visits, surgical procedures, and lab tests as well as supplies you may need like a wheelchair. This varies for Medicare Advantage plans. Part B covers necessary and preventative services.
Part B is optional, so you are not obliged to enroll, but you should carefully check with your retiree plan to see how it fits in with Medicare.
In many such plans, Medicare automatically becomes primary coverage and the plan pays only for a few services that Medicare doesn’t cover. In that case, if you fail to sign up for Part B when you’re required to, you’ll essentially have no coverage.
COBRA allows you to continue on your present employer’s health care plan, for up to 18 months after your job ends, but it doesn’t allow you to delay Part B enrollment, without risking late penalties. In this situation, you need to sign up for Part B before the end of your initial enrollment period at age 65, or (if your job ended after that period) no later than eight months after you stopped working.
According to Medicare.gov:
If you have employer or union coverage
If you or your spouse (or family member if you’re disabled) are still working and you have insurance through that employer or union, contact your employer or union benefits administrator to find out how your insurance works with Medicare. This includes federal or state employment, but not military service (unless on active duty). It may be to your advantage to delay Part B enrollment.
When employer/union coverage ends – Once your employment (or your employer/union coverage) ends, 3 things happen:
- You may be able to get COBRA coverage, which continues your health insurance through the employer’s plan (in most cases for only 18 months) and probably at a higher cost to you.
- You have 8 months to sign up for Part B without a penalty, whether or not you choose COBRA. To sign up for Part B while you’re employed or during the 8 months after employment ends, complete an Application for Enrollment in Part B (CMS-40B) and a Request for Employment Information (CMS-L564). If you choose COBRA, don’t wait until your COBRA ends to enroll in Part B. If you don’t enroll in Part B during the 8 months after the employment ends:
- You may have to pay a penalty for as long as you have Part B.
- You won’t be able to enroll until January 1–March 31, and you’ll have to wait until July 1 of that year before your coverage begins. This may cause a gap in health care coverage.
- If you already have COBRA coverage when you enroll in Medicare, your COBRA will probably end. If you become eligible for COBRA coverage after you’re already enrolled in Medicare, you must be allowed to take the COBRA coverage. It will always be secondary to Medicare (unless you have End-Stage Renal Disease (ESRD)).
If you have TRICARE
- If you are an active-duty service memberIf you’re an active-duty service member, or the spouse or dependent child of an active-duty service member:
- You don’t have to enroll in Part B to keep your TRICARE coverage while the service member is on active duty.
- Before the active-duty service member retires, you must enroll in Part B to keep TRICARE without a break in coverage.
- You can get Part B during a special enrollment period if you have Medicare because you’re 65 or older, or you’re disabled.
- If you have End-Stage Renal Disease (ESRD), you should enroll in Part A and Part B when you’re first eligible.
If you have Veterans’ benefits
If you have Veterans’ benefits, enrolling in Medicare may provide you with additional service and location options. If you don’t keep Part B, you may have to wait to sign up later, and you may pay a late enrollment penalty.
If you have CHAMPVA
If you don’t have any of the above
You should enroll in Part B when you’re first eligible. If you don’t sign up for Part B when you’re first eligible, you may have to pay a late enrollment penalty for as long as you have Medicare. Learn more about when you can sign up for Parts A & B.