I will be retiring in the next year and my employer provides lifetime retiree benefits. I have been told that the plan does not care if the retiree has Part B or not - they will pay first. Several previous retirees have elected not to take Part B and have had no problem with coverage using the benefits provided to retirees which is the same as active employees. I am concerned if in several years coverage is eliminated for retirees will I be able to elect Part B during a special enrollment period without a penalty? I continue to receive conflicting answers. The Medicare handbook states retiree coverage pays as a secondary, but my plan is different than most. I continue to receive conflicting answers.
Medicare Information and Discussions
Independent Community Helping you to Understand Medicare
Part B and Retiree Coverage
- Thread starter mutheta
- Start date
I would double check with the plan's administrator that it pays primary to Medicare and get that in writing. Some retiree medical plans paying first are doing so because they have not received information stating the member is now Medicare eligible. Either way, you should still enroll in Part A since it is free to you.
Even though the retiree plan may not care if it pays first, Medicare does care. The most popular retiree plan that does not require Part B enrollment is FEHB (Federal Employee Health Benefits) and the following is based on it. When a retiree drops FEHB, or if the plan were to be terminated, members are able to enroll in Part B at the next General Enrollment Period (GEP) which occurs 1/1-3/31 of each year with a 7/1 effective date. This sometimes creates a gap in coverage. The late enrollment penalty is applied. This is why some enroll in Part B and use FEHB as their supplement.
The Special Enrollment Period (SEP) only applies to current employment or Part B enrollment within 8 months of leaving employment.
Under current regulations, a person can avoid waiting until the GEP and avoid the penalty if they are eligible for the low income Medicare Savings Program (MSP).
You would not be subject to a Part D drug plan late enrollment penalty if the retiree plan provides a "letter of creditable coverage" when the coverage terminates.
Even though the retiree plan may not care if it pays first, Medicare does care. The most popular retiree plan that does not require Part B enrollment is FEHB (Federal Employee Health Benefits) and the following is based on it. When a retiree drops FEHB, or if the plan were to be terminated, members are able to enroll in Part B at the next General Enrollment Period (GEP) which occurs 1/1-3/31 of each year with a 7/1 effective date. This sometimes creates a gap in coverage. The late enrollment penalty is applied. This is why some enroll in Part B and use FEHB as their supplement.
The Special Enrollment Period (SEP) only applies to current employment or Part B enrollment within 8 months of leaving employment.
Under current regulations, a person can avoid waiting until the GEP and avoid the penalty if they are eligible for the low income Medicare Savings Program (MSP).
You would not be subject to a Part D drug plan late enrollment penalty if the retiree plan provides a "letter of creditable coverage" when the coverage terminates.
JC
Well-Known Member
I have ran into this problem recently with a beneficiary. When applying for Part B, medicare looks at the retirement coverage as paying after Medicare and there for is not considered creditable coverage rearguardless of how it pays. What this means to you is that if you elect to enroll into part B at some point in the future during the General enrollment you will also be paying penalties for not having set up part B when you were first eligible or at the time of retirement.