Covered By Your Spouse’s Insurance? You Have 3 Options for Health Care
More seniors than ever are working past 65, and as a result, the healthcare coverage landscape is changing. While many seniors choose to enroll in Medicare when they turn 65, others like their employer-provided plan better.
About 26% of the American workforce is between 65 and 74 years old—a trend that isn’t going anywhere. So, if you’re currently working past retirement age or are planning to, how should you select health coverage for yourself and your spouse?
What are my options if I have employer-provided healthcare?
If you’re over 65 and are covered by employer-provided health insurance, you have the power to choose what kind of health insurance you get. Still, there are important factors every senior needs to assess before making critical insurance decisions. Consider these options when choosing health care for you and your spouse.
1. You can do nothing.
If you and your spouse like your current coverage, you can keep it! You have every right to remain on your employer-provided plan as long as you’re employed. But a few important pieces of information may impact your decision.
If you contribute pre-tax income to a Health Savings Account (HSA) and want to continue that, stay on your employer’s plan. For many seniors, this is a much-needed nest egg to cover future medical expenses. But once you enroll in Medicare, you won’t be able to contribute to your HSA.
Staying on your employer’s plan also helps you and your spouse avoid paying unnecessary Medicare Part B premiums. And don’t worry, you won’t be penalized for waiting to sign up for Medicare. You can delay your enrollment in all Medicare benefits until your Special Enrollment Period (SEP), which includes you or a spouse losing private coverage when leaving a job.
However, if you think you’ll need any of the services covered by Medicare—such as hospice care—in the near future, you may want to enroll in Medicare while still on your own or your spouse’s employer-provided plan.
2. You can choose both private insurance and Medicare.
You may be surprised to learn you can carry private insurance and Medicare at the same time! A popular option for seniors with coverage provided by an employer or their spouse’s employer is to enroll in Medicare Part A. You’ll be fully covered with no monthly premiums as long as you’ve paid Medicare taxes for at least 40 quarters.
This added layer of insurance picks up where private plans leave off, acting as a supplemental insurance policy, should the need arise. Seniors who don’t use an HSA tend to enroll in Part A while still employed.
Remember, Medicare plans are individualized, so you and your spouse must enroll in Part A separately, should you choose. Of course, there’s no requirement for you both to enroll. If you prefer to rely solely on your employer-provided plan while your spouse gets both (or vice-versa), that works, too!
3. Drop your employee insurance.
Another option for you and your spouse is to drop your employee coverage altogether. Leaving your private plan is an attractive option for seniors with limited coverage or insurance plans with high monthly premiums. Enrolling in Medicare is also a good idea if you or your spouse have specific medical needs not covered by your employer-provided plan.
But remember, if your spouse carries the employer-provided insurance and drops it in favor of Medicare, you’ll lose coverage too. Employers won’t cover a spouse without first covering the employee.
You must also drop your employer-provided coverage within the appropriate time parameters. You can enroll in Medicare Parts A and B, the Medicare Part D prescription drug plan, or Medicare Advantage (Part C) during your Initial Enrollment Period (IEP) or SEP. The IEP begins the month of your 65th birthday and ends three months later. SEP timing varies and is based on your situation and life events.
For more answers about the intersection of employer-provided healthcare, Medicare, and what spouses should know, get in touch with us at 877.255.6273.
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