Sandwich Generation News Volume XI Number 3

For people sandwiched between aging parents and growing children

Provided by Lidke & Associates, Inc., 10 Inverness Dr E, Ste 110, Englewood, CO 80112-5611

Do I Need to Enroll in Medicare When I Turn 65?

Most people are confused about when to sign up for Medicare and what it really covers. When eligible people are close to age 65 Medicare will contact them. Eligible people may also include people who are receiving Social Security Disability, Railroad Retirement Disability or have End Stage Renal Disease. Individuals over age 65 who are not eligible for Social Security (by marriage or work experience) are not eligible for Medicare, but may be allowed to purchase Medicare coverage from the federal government if they have resided in the United States for at least five years.

There are two parts to Medicare coverage. Part A is free to individuals who have paid sufficient Medicare taxes under the Federal Insurance Contribution Act (FICA). Part A pays for Medicare-approved hospital expenses, skilled nursing care, home health care and out-patient hospice care. Part B requires a premium to be paid to Medicare and includes coverage for Medicare-approved physician services, out-patient hospital services, durable medical equipment, and rehabilitative home care services. Part B requires a Medicare premium. Both parts require Medicare approval of services for benefits to be paid by Medicare.

Here is how Medicare Part B works for actively working employees reaching age 65. If the employee works for an employer with 20 or fewer employees he must elect Medicare Part B upon turning age 65 or pay a 10% premium penalty for each year that Part B coverage is waived. For example, the employee was eligible for Medicare in the year 2000 but waived Part B coverage. In the year 2003 Part B coverage is elected. There will be now be a 30% additional premium charged for Part B coverage (10% for each year coverage was waived). This person can only enroll in Medicare Part B between January 1 and March 31 of each year with an effective date of July 1.

However, if an actively working employee reaches age 65 and works for an employer with more than 20 employees the employee can choose the employer’s Group Health Plan and waive Part B Medicare coverage without penalty or the employee can elect Part B and Medicare will be the secondary carrier to the Group Health Plan. Upon leaving employment the individual (and covered spouse) will have an eight month window in which to enroll in Medicare Part B. This is called a “Special Enrollment Period.”

This information is provided as an overview only and Medicare rules are subject to change. Contact Medicare for full details. Remember, Medicare offers only limited coverage for Medicare-approved home health care and nursing home care. Your employer-approved long term care insurance plan will fill these coverage gaps if you elect to purchase this type of protection. Call today for a private consultation for yourself, spouse, parents, parents-in-law and children or visit our website to request a quote at www.lidke.com.

To Request information or a consultation on this important aspect of pre-retirement planning contact us:

Please provide me with a Quote for Long term Care Insurance: http://www.lidke.com/forms/Surveyform.htm