Is Medicare required when one has adequate retiree health insurance?

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ResearchMed
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Is Medicare required when one has adequate retiree health insurance?

Post by ResearchMed »

We will be grandfathered into very good retiree health insurance when DH finally retires.
(The coverage won't be so good for many younger cohorts, unfortunately for them.)

From what we understand from reading the retiree policy and comparing it to the employee coverage we now have, it will be quite satisfactory. A bit different, but it looks good all the way around.

We signed up for Medicare A when we hit 65 (required to do so by employer).

Whenever DH does retire, are we still required to sign up - and pay - for Medicare B [and possibly other types of medical coverage... "D", Medigap/etc.] even though we will have suitable medical coverage through employer, but as "retiree status"?

RM
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whaleknives
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by whaleknives »

Your spouse's employer should tell you whether Part B is required, as they did for Part A.

Requiring Part B enrollment with retiree health coverage is common enough that Consumer Reports says
  • "You have a retiree plan. If you have a retiree plan from your old job, you must sign up for Part B when you turn 65. After you go on Medicare, the retiree plan becomes a secondary plan. But if your spouse isn't old enough for Medicare yet, he or she can still get the retiree plan if your former employer allows that.
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BL
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by BL »

This page from Medicare may have some value:
http://www.medicare.gov/supplement-othe ... rance.html
It lists some of the things to ask your insurer.

Perhaps this random website I found with Google has some insight:
http://www.medicareinteractive.org/page ... ipt_id=121
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heartwood
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by heartwood »

whaleknives wrote:Your spouse's employer should tell you whether Part B is required, as they did for Part A.

Requiring Part B enrollment with retiree health coverage is common enough that Consumer Reports says
  • "You have a retiree plan. If you have a retiree plan from your old job, you must sign up for Part B when you turn 65. After you go on Medicare, the retiree plan becomes a secondary plan. But if your spouse isn't old enough for Medicare yet, he or she can still get the retiree plan if your former employer allows that.
My wife's state provided plan requires that we enroll in Part B at 65 and provide them evidence of coverage or they will drop us. As others note Medicare becomes primary coverage and in our case the state plan becomes secondary. It's a very good deal, usually with the same copay as before.
dbltrbl
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by dbltrbl »

Most retiree plan requires you to buy medicare past B at minimum. That way they are secondary providers.
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retiredjg
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by retiredjg »

Even if you are not required to buy Part B, it seems like a good thing to do anyway. When you are covered by 2 policies, you will pay nothing or next to nothing for medical care - the 2 policies pay it all. Not sure yet if that includes a yearly deductible - you might still have that.

It definitely does not include drugs though. You will still have a copay for drugs. I don't know if part D changes that or not.
bayview
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by bayview »

Federal retirees keeping their FEHB in retirement do not have to buy MC-B:

https://www.opm.gov/healthcare-insuranc ... -coverage/

DH is retired and 65, and he waived Part B. I'm still working (for forever, it sometimes seems), and he is on my FEHB plan plus his own MC-A.

When (if???) I retire, we'll revisit the whole issue. Things change so fast that I'm not going to try to guess now what will be the best combo on down the road.
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by Lynette »

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dm200
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by dm200 »

As far as I know, there are absolutely no guarantees that this coverage will continue into the future. I believe that, at any time, the former employer could unilaterally terminate the benefit. If this is a private company, there is always the possibility of merger, going out of business, etc.

A friend of ours recently retired from a large U.S. Corporation, known for many decades of excellent benefits, retirement benefits, etc. That company had, for many decades provided some degree (not sure details) of retiree health/medical benefits. As she was doing paperwork for retirement, the company announced the termination of ALL retiree health insurance benefits (for those 65 and over).
Spirit Rider
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by Spirit Rider »

ResearchMed wrote:Whenever DH does retire, are we still required to sign up - and pay - for Medicare B [and possibly other types of medical coverage... "D", Medigap/etc.] even though we will have suitable medical coverage through employer, but as "retiree status"?
it wouldn't make sense for a company to require you to get Medicare Part B and MediGap/Part D. After all, what would they really be covering? As has been noted earlier, some government plans do not require enrolling in Medicare Part B. This can also be true of some unions plans. I would expect this to be increasingly rare.

Depending on the size of your company, the retiree health plan (>= 65) may in fact just be a Medigap/ Plan D combination with the premiums paid by the employer. Larger employer retiree plans might be essentially group MediGap/Plan D combinations with features slightly different from the Medicare mandated MediGap options. It only makes administrative sense for the insurance companies to limit the number of plans they offer.
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dm200
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by dm200 »

Spirit Rider wrote:
ResearchMed wrote:Whenever DH does retire, are we still required to sign up - and pay - for Medicare B [and possibly other types of medical coverage... "D", Medigap/etc.] even though we will have suitable medical coverage through employer, but as "retiree status"?
it wouldn't make sense for a company to require you to get Medicare Part B and MediGap/Part D. After all, what would they really be covering? As has been noted earlier, some government plans do not require enrolling in Medicare Part B. This can also be true of some unions plans. I would expect this to be increasingly rare.

Depending on the size of your company, the retiree health plan (>= 65) may in fact just be a Medigap/ Plan D combination with the premiums paid by the employer. Larger employer retiree plans might be essentially group MediGap/Plan D combinations with features slightly different from the Medicare mandated MediGap options. It only makes administrative sense for the insurance companies to limit the number of plans they offer.
Yes - it might make a lot of sense, IF the company insisted their coiverage was secondary to Medicare.
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by Spirit Rider »

dm200 wrote:
Spirit Rider wrote:Yes - it might make a lot of sense, IF the company insisted their coiverage was secondary to Medicare.
Insisting their coverage is secondary to Medicare is not the issue. Medigap and Medicare Part D are insurance policies that by definition cover what Medicare Parts A and B don't cover.

Rather my point to the OP was that retiree health coverage >= 65 would not be covering anything if they also required Medigap and Part D coverage in addition to Parts A and B.
dbr
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by dbr »

As mentioned above, I would wager this plan like almost all retiree insurance for Medicare qualified retirees is really supplemental insurance. It is highly unlikely this covers the Part B coverages and is primary in any sense. Getting an iron clad clear answer that this plan is more than that would be absolutely necessary before eshewing Part B.

I would also be sure to understand your options when this retiree insurance is terminated with or without notice as the employer decides to no longer offer it. The issue is when not if. I think, but cannot be sure, you would then have an open enrollment opportunity for an actual Medigap plan.

At Megacorp there is an option to take a Health Care Reimbursement Account rather than the employer supplemental retiree plan. That stipend can apply to Part B, Part D, and Medigap premiums and any unreimbursed exspenses.That is a much better option for both the employee and the company when it comes to organizing insurance coverage under Medicare/Medigap. I know people who are on Federal Employee health plans (CSRS employee) who do take the Federal insurance as secondary. They buy Part B as a requirement not Part D as drug coverage is in the supplement.
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ResearchMed
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by ResearchMed »

Thanks very much, all.

This is even more confusing now, and will need to wait until Monday when HR opens.

The confusion is because the brochure description of the retiree plan is just about as complicated as the brochure for the regular employee plan choices (BCBS, local HMO, POS, another POS, non-local residence choice, etc.).

This is a major university with a huge endowment, and even during the 2008 debacle, it was sort of laughable in terms of what their loss really meant, even though the numbers seemed staggering.
[I can't help thinking it's sort of like Warren Buffett or Bill Gates, unless they were leveraged up the wazoo and got gigantic margin calls, which apparently wasn't their style... or need.]
I'm sure it is not impossible that it goes belly up someday (what won't, eventually?), but so very unlikely in the next few decades we'll care about.

Now... whether they will decide to change things, that's different.
Thus far, there is a strong history of not making major changes to the employee benefit status quo (sometimes for the better, sometimes not so much), as it's so huge AND all categories of employees can be extremely vocal and action-oriented.
That's among the reasoning why the older "retirees-to-be" were all grandfathered in to the old plan, and only the very youngest new employees will apparently see anything significantly different.
[As it was, a far lesser change to the employee plan was met with an uproar, and the changes were rather quickly rolled back, and affected employees were quickly given outright subsidies to pay for the "difference".]

This is probably not immediately on our radar because DH isn't the least interested in retiring (health allowing!), but I'm realizing that we just don't understand how this very detailed retiree plan (deductibles, co-pays, etc., much like our current plan) will work, given Medicare.

Does anyone have a retiree plan that is similar to their employer plan and has been using it for a while, after age 65 in conjunction with Medicare?

If so, how has it actually worked?
Did you sign up and pay for Medicare B, for example?

Thanks again.

RM
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dbr
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by dbr »

ResearchMed wrote: If so, how has it actually worked?
Did you sign up and pay for Medicare B, for example?

Thanks again.

RM
I can give you two instances. I had on offer such a plan from my former employer. The plan is secondary and REQUIRES that you sign up for Medicare A and B but not for D or for any Medigap or Advantage Plan. I elected not to take that plan because they offered the alternative of an HCRA. One reason I did not take the alternative is because at time of retirement there were no plan documents available because Megacorp legal dept. and Megainsurance legal dept. were in a protracted discussion regarding the terms of the plan and would not issue a plan description of benefits. This is from a world renowned major corporation. I also did not take the plan because I did not want to deal with any ambiguity in missing the six month open enrollment period for Medigap and I was satisfied with the terms of the Medigap plan I bought plus the HCRA.

The second instance is a person I know who is a Federal CSRS retiree. As I understand the plan he is required to take Medicare A and B. He has taken Medicare A and B. The Federal Employee Retirement Plan, administered by BCBS in our area, covers supplemental costs and prescriptions. The coverage is better than I have seen anyone else anywhere carry. He pays for Part B by deduction from his SS benefits. Note that while being a CSRS retiree he also has enough quarters of SS contribution to be Medicare qualified.

Incidentally he and I both probably still have some benefits under VA as service veterans but we are not military retirees, so I have never inquired.
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ResearchMed
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by ResearchMed »

dbr wrote:
ResearchMed wrote: If so, how has it actually worked?
Did you sign up and pay for Medicare B, for example?

Thanks again.

RM
I can give you two instances. I had on offer such a plan from my former employer. The plan is secondary and REQUIRES that you sign up for Medicare A and B but not for D or for any Medigap or Advantage Plan. I elected not to take that plan because they offered the alternative of an HCRA. One reason I did not take the alternative is because at time of retirement there were no plan documents available because Megacorp legal dept. and Megainsurance legal dept. were in a protracted discussion regarding the terms of the plan and would not issue a plan description of benefits. This is from a world renowned major corporation. I also did not take the plan because I did not want to deal with any ambiguity in missing the six month open enrollment period for Medigap and I was satisfied with the terms of the Medigap plan I bought plus the HCRA.

The second instance is a person I know who is a Federal CSRS retiree. As I understand the plan he is required to take Medicare A and B. He has taken Medicare A and B. The Federal Employee Retirement Plan, administered by BCBS in our area, covers supplemental costs and prescriptions. The coverage is better than I have seen anyone else anywhere carry. He pays for Part B by deduction from his SS benefits. Note that while being a CSRS retiree he also has enough quarters of SS contribution to be Medicare qualified.

Incidentally he and I both probably still have some benefits under VA as service veterans but we are not military retirees, so I have never inquired.
Thanks.

Well, neither of us was ever a Federal employee, so that comparison is out.
Ditto the other, as I don't remember any such choice for a HCRA, although this is all new here within the past year, so it could be evolving with that.
Or not.

I'll just have to check in great detail on Monday.
(I'm the one who keeps in close contact with this senior HR person about tweaks/concerns/complaints/suggestions/requests for our 403b plan, so this person will undoubtedly be absolutely DELIGHTED ("NOT"!) to hear my cheery voice... But they do listen, and have actually made some changes to the 403b, so it's all worth it.)

What's particularly confusing is that if this retiree plan is "secondary" (which is seeming likely - maybe?) is then... why the detailed co-pays, deductibles, max per certain procedures, separate in-or-out of network schedules, etc.
And there are several different retiree plans to choose from, just as there are during the employee stage.
It just seems that coordinating the actual payments from two plans with very different specifics would get nightmarish.
Maybe not.

As an aside, we also aren't sure why we are required to sign up for Medicare A (which we each did at 65, although there's no cost) while we keep the full employee health insurance with no change.
Is the employer (or health insurance company) passing along certain costs to Medicare, unseen by us?
I doubt that it matters, but employer "self insures" and the various health plans really only do the administration part.
(No complaint if that's what's happening; just curious why the mandated Plan A.)

Thanks again.

RM
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heartwood
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by heartwood »

The table on page 6 might help: http://www.medicare.gov/Pubs/pdf/02179.pdf

To also answer your question of personal experiences: before retirement we were covered by a state health plan. Upon retirement it converted to a state retiree plan that mirrored the original plan. As a retiree it requires you to register for Medicare A & B, and provide proof to the state of that enrollment. If you do not, coverage ceases and you're on your own. Once enrolled in Medicare it is primary and the state plan is secondary. This is essentially what's shown on page 6 above. It looks like who's primary/secondary when you have both Medicare and other insurance depends a lot on whether you are retired or not.

The state plan also provides Part D coverage and reimburses for Medicare premiums. One year we had higher income and were subject to the higher Medicare rates for B & D. The state plan then reimbursed us for those amounts.
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by westie »

Doesn't Medicare become the primary insurance for everyone 65 and over by law?
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BL
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by BL »

As an aside, we also aren't sure why we are required to sign up for Medicare A (which we each did at 65, although there's no cost) while we keep the full employee health insurance with no change.
I recall an incident where an older coworker (past age 65) was in the hospital and then needed rehab at a nursing home. She and her family really had to scramble to get signed up for Medicare Part A to get covered for nursing home stay (after 72+ hours in hospital). Evidently health insurance didn't cover it otherwise.
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heartwood
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by heartwood »

westie wrote:Doesn't Medicare become the primary insurance for everyone 65 and over by law?
I thought so too until I saw several comments here. I googled "medicare primary insurance" and found the link I posted above from SS. Look at the table on page 6. From my read it depends on whether you are still working or are retired.

http://www.medicare.gov/Pubs/pdf/02179.pdf
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GerryL
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by GerryL »

From what I have read in many sources: retiree plans and COBRA do not count as the kind of coverage that would allow you to delay taking Part B. Example from Medicare for Dummies: "...when it comes to delaying Part B, neither type of benefit counts as employee coverage. Too many people fall into this trap, often with serious consequences. ... (K)eep in mind that the Part B late penalty clock starts ticking when the job ends [if you are 65 or older]."

In other words, if you decide to save money and rely only on the retiree plan and not sign up for Medicare (if the retiree plan allows that), you could face a very high penalty that would seriously jack up your Medicare premiums if/when your former employer decides to stop offering this benefit.

Your HR people should (I hope) be able to clarify this for you.
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dm200
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by dm200 »

Based on what has happened for many organizations/companies, changes/acquisitions/mergers can happen very quickly - and often without signs of problems/issues with a company/organization. In this case, IMO, being signed up for Medicare parts A and B is a very prudent step that may reduce risks of sudden coverage changes.

Even if coverage will be continued, some of these corporate changes might cause some degree of turmoil and questions of coverage, payment of claims, medical/health providers covered, etc.
mur44
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Re: Is Medicare required when one has adequate retiree health insurance?

Post by mur44 »

In general, you will need to enroll in Medicare Part B as
part of retiree health insurance. Part D is usually not needed.

To obtain free and unbiased counseling, call or visit your
local SHIP (State Health Insurance Assistance Program)
by choosing your state and county:

https://shipnpr.acl.gov/Default.aspx?As ... eSupport=1


Disclosure: I am a Certified Volunteer Medicare Counselor from NJ
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