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Roadmap to Medicare SSDI Over 100 Employees

Customized Roadmap Report

Click on the image to download your 1 page Roadmap

Enrolling in Medicare

You will be automatically enrolled in Medicare Parts A and B effective after 24 months of SSDI.

Since you are collecting SSDI (Income), you are required to keep your Medicare Part A.  You will have the option to keep or return your Medicare Part B.  After reviewing ALL of the information on this webpage, click on Keep Part B or Return Part B for detailed enrollment/deferral instructions based on your situation.

If your Group Health Plan is cost effective and provides comprehensive coverage, you may want to...

Please follow the instructions that came with your Medicare Card to Return your Medicare Part B. 

To Enroll in Part B later:

The Request For Employment Information form provides the creditable coverage information to avoid a Medicare Part B penalty when you enroll later. This form is not required until you are ready to enroll.

No need to keep this form, we can provide the current version when you are closer to enrollment.

If you change jobs before re-enrolling, you will be required to get this form completed by each employer that provided Group Health Benefits from the time you qualified for Medicare until the time you enroll.

If you would like supplement your Group Health Plan, or Medicare is more cost effective than your Group Health Plan, you may want to...

You will automatically be enrolled in both Medicare Parts A and B.  Simply, do nothing to keep Medicare Part B.

Your Roadmap is based on…

  • You are under age 65, but qualifying for Medicare due to SSDI
  • Your Primary Insured intends to remain ACTIVELY WORKING (at the employer providing your benefits)
  • You ARE covered under the group health insurance plan
  • The employer providing health insurance has MORE THAN 100 employees

Will I receive a penalty if I don’t enroll now?

No. You will not receive a late enrollment penalty provided you remain covered under the group creditable coverage and your primary insured remains actively at work at the employer that provides your benefits and the employer providing the benefits has over 100 employees.

Part A: Is required since you are collecting SSDI.

Part B: You will receive a Part B Late Enrollment Penalty if you do not have creditable coverage.

  • Creditable coverage is group health insurance coverage while the Primary Insured is actively working for the employer providing the Group Health Plan.
    • Severance, COBRA and/or Retiree Plans are not creditable for avoiding the penalty.
    • Those who have Medicare based on disability can enroll later under an SEP if they, their spouse, or their family member is working, and have coverage by an employer or union GHP (with at least 100 employees – also known as a Large GHP) based on that employment.  For reference, see heading titled Enrolling with a Special Enrollment Period.

A 10% penalty added for every 12 months you go without creditable coverage. Months need not be consecutive. See Details on how the penalty is calculated.

  • The penalty will be assessed on the Base Medicare Premium ($144.60/month in 2020) for as long as you are enrolled in Medicare.

Part D: You will receive a Part D Late Enrollment Penalty if you do not have creditable prescription coverage.

  • Creditable prescription coverage is drug coverage that is expected to pay, on average, at least as much as Medicare’s standard prescription drug coverage.

A 1% penalty added for every 1 month you go without creditable prescription coverage. Months need not be consecutive.

  • The penalty will be assessed on the Average Medicare Part D Premium ($32.74/month in 2020) for as long as you are enrolled in Medicare Part D.

Penalty Reset: Everything changes when you reach 65. At the end of the month before the month in which you turn 65, you lose your entitlement to Medicare based on disability. At the beginning of the month you turn 65, your entitlement to Medicare based on becoming 65 begins. In other words, you get a second initial enrollment period.  At that point the clock is reset, and Medicare coverage begins anew as though you’d never had it before.  Any penalties that were assessed will be removed.

What is my deadline to enroll?

You can enroll in Part B anytime up to 8 months after your large group coverage or the employment that it is based on ends.

Part A: You will be automatically enrolled in Medicare Part A after 24 months of SSDI.  You will be required to keep Part A since you are collecting SSDI.

Part B-SEP: You will be automatically enrolled in Medicare Part B after 24 months of SSDI.   If you return your Part B and want to enroll later, you will have an 8 month Special Enrollment Period from the time your group health coverage or the employment that it is based on ends (whichever comes first) to enroll under a Special Enrollment Period.

  • Those who have Medicare based on disability can enroll later under an SEP if they, their spouse, or their family member is working, and have coverage by an employer or union GHP (with at least 100 employees – also known as a Large GHP) based on that employment.  For reference, see heading titled Enrolling with a Special Enrollment Period.

Part B-GEP: If you miss your Initial Enrollment Period, you will be able to enroll annually during the General Enrollment Period (however, penalties may apply).

  • The General Enrollment Period is from January 1st to March 31st each year. Your Part B effective date will be July 1st following your enrollment.

Do I need Medicare to have full coverage?

No.  Your group coverage should remain primary insurance as long as the employment that it is based on continues. 

Medicare “Who Pays First” Law states that your Group Health Insurance will remain primary insurance when you are on Medicare due to SSDI as long as you remain covered by Group Insurance based on Current Active Employment through an employer with more than 100 employees.

  • You have to keep your Medicare Part A since you are collecting social security income, but you do not need Medicare B to have full coverage under your group plan.

Secondary Insurance Options

Since your current plan will remain primary to Medicare as long as you remain enrolled in it, Medicare B is not required to have full coverage at this time.  (Medicare Part A is required because you are collecting Social Security Income).  You will have the option to keep your Group Health Plan or switch to Medicare and elect a Medicare Supplement Insurance Plan or Medicare Advantage Plan and Medicare Prescription Drug Plan.

Does it make sense to drop my group health plan to enroll in Medicare?

A general rule of thumb is that if your group health plan costs on average less than $300/month/person or about $3600/year/person, then your group health plan is more cost effective than Medicare.

  • Please add up the premiums, copays, deductibles and coinsurances (everything except Rx cost) of your current group health plan for comparison.

However, if you think you may pay more than that, or you are seeking lower deductibles and copays, then you may want to explore Medicare further.

Please contact us for a Medicare Cost Analysis to help you better evaluate if your Group Health Plan or a Medicare plus a Private Medicare Supplement and Medicare Prescription plan is more cost effective.

  • If Medicare coverage is more cost effective than your current plan, you may want to replace your current plan.

Underwriting Considerations

Once you enroll in Medicare Part B, you will have an Open Enrollment Period/Special Election Period to choose your secondary coverage without having to medically qualify.

When under age 65 and on SSDI, plan availability is state specific.  Please see HTA for plan options.

Additional Considerations

Spouse Under Age 65-  If your spouse relies on your group health plan for benefits, please be mindful that if you come off your group plan, your spouse will have to go on COBRA, seek benefits through their respective employer, or purchase individual health insurance until they become Medicare eligible.

Important HSA Considerations– You cannot continue to contribute to your Health Savings Account (HSA) once you enroll in Medicare Part A.  If you are enrolling in Medicare after age 65, your Part A effective date may be back dated up to 6 months.  Please contact us to discuss the HSA maximum contribution rate for you circumstances.  Click Here for Details and Rules.

  • This does not apply to Flexible Spending Accounts (FSA) or Health Reimbursement Accounts (HRA).  Medicare does not have any restrictions on these types of accounts.