Comparing Employer Coverage and Medicare

As you approach retirement, you may be juggling a lot of questions about the changes it will bring. Health care coverage is often one of the biggest concerns that individuals have as they prepare to leave the workforce. On the other hand, perhaps you are working past age 65 but contemplating switching to Medicare to improve your coverage. No matter your circumstances, here are some factors to consider as you plan the transition from employer coverage to Medicare.

Medicare Offers More Options

When you enrolled in your health care coverage through your employer, you likely chose from less than a handful of available plans. By comparison, Medicare has over 200 plans in Ohio alone. This can make transitioning from employer coverage to Medicare overwhelming for some individuals.

But the multitude offered by Medicare can work in your favor, despite how mind-boggling it may seem to choose one plan out of hundreds. With more selection, enrolling in Medicare gives you an opportunity to find a health care plan better tailored to your specific needs. Switching from employer coverage allows you to shed the one-size-fits-all insurance model.

Many Medicare plans are offered by the same carriers that provide employer coverage, as well. If you enjoy the customer service you get from your current insurance carrier, for example, you may still be able to continue with them on Medicare.

Your Costs Will Change

Switching to a new health coverage plan means that some of your costs will change. This is unique for every plan, but generally speaking, Medicare can provide more benefits than employer coverage at a lower cost.

Especially if you have a premium or high deductible plan through your employer (or your spouse’s employer), switching to Medicare may be more cost-effective. Many Medicare plans offer first dollar coverage, meaning you can pay little if anything out of pocket for health care visits. Depending on your plan, Medicare has $0 premiums and low to $0 deductibles.

Keep in mind that some parts of Medicare—Part B and Part D premiums—can be adjusted based on income, but this only applies to a small handful of individuals. Additionally, you cannot add dependents to Medicare coverage. You may need to make accommodations for your spouse’s insurance. Our team of benefit advisors will consider all these factors as we assess the best plans for your budget and health care needs.

Some Benefits May Carry Over

To smoothen the transition from employer coverage to Medicare, some benefits of your current plan may remain after you switch. One example is your health savings account (HSA). When you enroll in Medicare, you can no longer contribute new funds to an HSA through your employer. However, you can use the HSA funds you already have on hand to pay for Medicare costs.

If your employer’s prescription drug coverage is creditable to Medicare, you can also keep it when you transition into retirement. However, many Medicare prescription drug plans offer no premiums and low deductibles for your drug costs—so regardless of whether your coverage carries over, your prescriptions will still be accessible and affordable.

As you prepare to transition from employer coverage to Medicare, let RetireMEDiQ do the research for you. We make it easy for you to choose the best Medicare plan by comparing your needs against the options in your area. Reach out to us today at 1-844-388-6565 to speak with a program advisor!

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