The recent 65th birthday of Dr. Donald Berwick, head of the Centers of Medicare and Medicaid Services, provides a chance to better understand Medicare if you’re in the run-up to 65… or know someone who is.
If you’re about to turn 65, your “full retirement age” according to Social Security is 66 or even a few months older. The longer you wait (up to 70 if you want), the more you get (assuming you live many more years–sorry to be macarbe on Monday morning but that’s how Social Security works). Typically, if allowed, you would want to continue to stay on employer sponsored insurance even though eligible for Medicare because in general such insurance is much better than Medicare, which has high co-pays and deductibles, no vision or dental, geographic restrictions and lifetime limits (see more detail here). And typically employers have to allow you to stay on their plan or it would be considered discrimination. But every situation is different so check with your HR department, Medicare, and Social Security before making up your mind.
So how does it work for Dr. Berwick and might it work for you if your circumstances are the same as his: still working, working for an organization with more than 20 employees, not collecting Social Security yet, and/or plan to continue to get healthcare insurance from your employer?
First, as the NPR article in the first link explains, Berwick says he’s “in the process of signing up.” Huh? Isn’t it automatic you say? No, Medicare is not automatic when you turn 65 unless you are already on Social Security. Medicare and Social Security ages were in synch when Medicare started in the 1960s but they became out of synch with the Social Security reform during the 1980s.
Second, if you plan to keep working after 65 and keep getting your health insurance through an employer (or a spouse gets coverage for you through his or her employer), the Medicare rules are different depending on whether the employer has 19 or fewer vs. 20 or more employees. Talk to the human-resources (HR) administrator where you work about the differences.
Third, usually the best thing to do for everyone turning 65 is to at least sign up for Medicare Part A even if you plan to keep working just to get in the Medicare system. That’s what Dr. Berwick says he plans to do. And Medicare Part A, which primarily covers hospitalizations, is free (as long as you worked enough Social Security quarters). But the Medicare hotline told me there are situations where signing up for A while you’re still working could hurt your private, state/local-government, union or Social Security retirement benefits in the future. Talk to Social Security about it before you turn 65 even if you do not intend to take Social Security benefits early.
And as the NPR story about Dr. Berwick explains, you also need to talk to Social Security if you decide to sign up for Part A and send them or bring them your birth certificate. Not surprisingly it is yet another life-change situation where you don’t have to show your Social Security card.
Almost all you probably did not want to know about this subject can be found in this Medicare booklet.