Medicare is a complex system. There are multiple rules and enrollment periods and if you make a Medicare mistake the penalties can last the rest of your life. Additionally, having a gap in your coverage can be financially catastrophic if you have a serious health event during that timeframe.
Below are a number of situations which can cause you to make a mistake with your Medicare. Agents at New Jersey Medicare Brokers can help answer your questions so that a Medicare mistake doesn’t happen to you.
If you lose your health insurance from an employer you have the option to enroll in COBRA which allows you to continue your employer coverage for up to an additional 18 months. For those that turn 65 during this period it is very important to enroll in Medicare when you’re first eligible so that you do not miss your enrollment window. If you have employer coverage you can delay enrolling in Medicare Part B until after you lose your employer coverage without being penalized and with an enrollment window. HOWEVER, Medicare does not consider COBRA insurance to be credible coverage and therefor if you miss your enrollment period it can delay when your Medicare Part B will start and you will get a late enrollment penalty for not having credible coverage.
Many Medicare eligible individuals in New Jersey do not know they can qualify for assistance with their medication costs. NJ PAAD and Senior Gold can save New Jersey residents thousands of dollars per year. These NJ state assistance programs do NOT ask about assets to qualify, only your income. Therefore you can have a retirement account, own your home, and have money in the bank and still qualify for the program. If your income is below $27,951 as a single or $34,268 as a couple you can qualify to get your drug plan premium paid for by the state and the highest cost of each medication is $7. More information about NJ PAAD can be found here.
Medicare can start the first day of your birthday month and if you were born on the 1st of the month Medicare can start the first day of the month prior to your birthday month. If you are not collecting Social Security benefits you will have to apply for Medicare Part B. Unfortunately, Medicare has a rule that if you apply for Medicare after your birthday month you will have to wait between 1 to 3 months before the coverage actually starts. This can cause a gap in your health insurance while you wait for your Medicare Part B to start and if you have a health event the bills can be crippling. Additionally, 4 months after your birthday month you have missed your enrollment period and you can’t qualify for coverage again until July of the next year unless you have employer coverage.
During the Open Enrollment each year, between October 15th and December 7th the changes to each Medicare Advantage and Prescription Drug (Part D) plans are released for the upcoming year. Annually these plans change in their monthly premium, deductibles, the copays/coinsurance for medications and services, the pharmacies which have the lowest cost, and medications the plan covers. It is important to review your coverage to ensure your plan is still the best fit for your medications, budget, and healthcare needs.
An HMO plan has a network of doctors and hospital which it contracts with for the insured members to use for their healthcare needs. Members in an HMO must use in network providers unless they have an emergency. Sometime members don’t follow this rule and see doctors outside of the network. They then get a large bill for the service and do not have any recourse with the insurance company unless it was an emergency situation.
Medications can vary drastically in price from one pharmacy to another. Each prescription drug plan (whether it’s included in a Medicare Advantage plan or a stand alone Part D drug plan) has a preferred network of pharmacies and a standard network of pharmacies. If you are not using your drug plans preferred pharmacy, which typically includes the mail order option, you may be paying more for your medications and the difference can be significant.
If you decide to continue working after age 65 and have employer coverage you have the option to delay your Medicare Part B until you retire or lose your employer coverage without penalty or waiting periods. Medicare costs $135.50 for most people and you can delay this monthly cost by postponing your Medicare Part B coverage until retirement. This makes sense if you have good employer coverage, but sometimes it makes sense to have both your employer coverage and Medicare as a secondary payer (if your employer is less than 20 employees than Medicare is the primary and your employer coverage is the secondary). It’s also important to check medication costs on Medicare vs employer coverage. Medication costs on Medicare can be significantly more expensive than employer coverage because of the coverage gap aka the “donut hole”.
Avoid making a Medicare mistake by working with an agent at New Jersey Medicare Brokers who knows the rules and enrollment windows so you don’t have to. There’s no charge to work with an agent and they will shop the market to find the policy that makes sense for your healthcare needs.