[et_pb_section fb_built=”1″ _builder_version=”3.22″][et_pb_row _builder_version=”3.25″ background_size=”initial” background_position=”top_left” background_repeat=”repeat”][et_pb_column type=”4_4″ _builder_version=”3.25″ custom_padding=”|||” custom_padding__hover=”|||”][et_pb_text _builder_version=”4.4.4″ hover_enabled=”0″]<\/p>\n
We received a frantic call from a client insisting they just had to talk to an advisor immediately!<\/p>\n
I recognized the name – a brand-new Medicare client. The client was delighted I took her call. “DAVID! Thank goodness! This is Grace, and I just took a job that offers health care, dental, and vision! Can I cancel my Medicare and take the employer plan?” She asked excitedly.<\/p>\n
“The quick answer is probably,” I replied. “But let’s review the details to see which is most appropriate.” “Firstly – is the employer plan Creditable – meaning as good as Medicare – and are there a minimum of 20 employees on the plan. If the employer plan doesn’t meet these two requirements and you leave Medicare, you’ll get an increasing penalty when you re-enroll later for each month you were not on a qualifying plan when eligible.” Grace confirmed \u2018Yes\u2019.<\/p>\n
Next, because she was a high-income earner the previous year, IRMAA fees contributed to her Part B & D Medicare costs of $437.30 a month, instead of the base rate of $148.50 most Americans pay. (Remember, high-income earners pay a surcharge for Medicare benefits.) Grace supplemented her Original Medicare with Medigap Plan G ($130 a month) and a Part D drug plan ($13.50). In total, she was paying $580 a month for her plans, with no co-pays for medical, and her generic prescriptions were free.<\/p>\n
Her new employer premium would be $200 a month with a $1500 maximum out-of-pocket for co-pays. “The answer is just math,” I explained. “Your plan at work in a worst-case scenario over a year would cost $3,900.” (12 months times $200= $2,400 + $1,500= $3,900). “But 12 months on Medicare will cost you $7,172.60.”($437.30 + $130 + $13.50 = $580.80 times 12 months = $6,969.60 + the once-a-year Plan G deductible of $203 = $7,172.60). “By switching to the employer group plan, you will be saving approximately $3,272 a year.”<\/p>\n
“If I drop Medicare, will I pay the penalty to get back on?” Grace asked. No, when you leave a creditable employer plan, they provide a form that proves you had the employer health plan. To suspend your Medicare, call 800-Medicare and call the insurance companies to cancel your Medigap and Part D drug plan. Grace was elated to see that she would save over $3,000 a year. I reminded her that she should call us 4-5 months before she retires from the new job to review her future options for Medicare plans.<\/p>\n
Call us to review the pros and cons of switching health coverage as everyone’s situation and needs are unique.<\/strong><\/p>\n [\/et_pb_text][\/et_pb_column][\/et_pb_row][\/et_pb_section]<\/p>\n","protected":false},"excerpt":{"rendered":" We received a frantic call from a client insisting they just had to talk to an advisor immediately! I recognized the name – a brand-new Medicare client. The client was delighted I took her call. “DAVID! Thank goodness! This is Grace, and I just took a job that offers health care, dental, and vision! Can […]<\/p>\n","protected":false},"author":5377,"featured_media":210668,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"","_et_gb_content_width":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[111],"tags":[],"class_list":["post-210706","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-american-retirement-advisor-blog"],"yoast_head":"\n