Medicare Part B: Medical Insurance

I’m sure you have some burning questions about Medicare Part B like…

Why am I paying so much for it?

What’s this “20%” I keep hearing about?

Do I even need it if I’m still working?

Let’s take a look at these answers and more…

Medicare Part B: What it is

Medicare Part B is known as Medical Insurance. It’s one of the 4 parts of Medicare.

Medicare Part B, along with Part A, are known together as Original Medicare.

They are the only main Parts of Medicare that you get through the U.S. government, and are shown on your red, white, and blue Medicare card.

The other two main Parts of Medicare are:

Any Part C and Part D coverage is provided by private insurance companies.

You can see the overall picture of Medicare below, along with where Part B fits in:

Medicare Part B

Medicare Part B Costs: Premium

Did you know that you have to pay a monthly premium just to have Part B?

Every once in a while, I’ll talk to someone just starting Medicare that is surprised by this.

When you’ve had money taken out of your paycheck all these years for FICA, that only goes toward paying for Part A, not Part B.

Part B Premium

Not everyone pays the same amount for Part B each month.

Let’s start though with the standard amount that most of you will pay, and then we’ll take a look at some other cases…

Standard Part B Premium

The standard amount is $148.50 in 2021. This amount usually goes up a little bit each year.

However, if your income is either over or under certain amounts, you’ll pay a different amount for Part B:

Part B Income Related Monthly Adjustment Amount (IRMAA)

IRMAA amounts

There are 5 different, higher amounts you could pay for Part B. The higher your income is, the higher your premium will be.

And what I mean by income is your modified adjusted gross income or MAGI. Your MAGI is your adjusted gross income (AGI) plus certain tax-exempt income, including any Social Security income you receive that isn’t already taxed.

You can see the various Part B premiums in the chart below:

Individual Tax Return MAGI

Joint Tax Return MAGI

Married Filing Separately MAGI

Part B Monthly Premium

% of Total Premium

$88,000 or less

$176,000 or less

$88,000 or less

$148.50

25%

$88,001 - $111,000

$176,001 - $222,000

n/a

$207.90

35%

$111,001 - $138,000

$222,000 - $276,000

n/a

$297.00

50%

$138,001 - $165,000

$276,000 - $330,000

n/a

$386.10

65%

$165,001 - 499,999

$330,001 - $749,999

$88,001 - $411,999

$475.20

80%

$500,000 or above

$750,000 and above

$412,000 and above

$504.90

85%

The chart also shows what percentage the government pays of your Part B premium for each income level. For most people, the government pays 75% of the premium. This means the $148.50 amount is only 25% of the Part B monthly premium cost.

It’s not really necessary to know what percent you pay; it’s just a little fun fact. 🙂

Also, if you’re married and filing jointly, your spouse’s income is included in addition to yours even if they’re not eligible for Medicare yet.

Your IRMAA is based on your MAGI from two years ago. This is the income amount the IRS has for your record when the current year starts which is based on your most recent submitted tax return, or 1040.

For example: your 2021 IRMAA is based on your 2019 MAGI because when 2021 started, the most recent tax return you submitted in 2020 was due for the 2019 tax year.

Appealing IRMAA

If your income for the current year will be less than this amount, you can appeal your IRMAA and possibly lower your premium. You can appeal for reasons like:

  • Marriage, divorce, or death of a spouse
  • Work stoppage or reduction
  • Loss of pension or income from real estate

You can fill out the SSA-44 form to file your appeal. It comes complete with instructions on how to fill it out, provide proof of the reason you’re appealing, and turn it in.

You could possibly pay less than the standard Part premium if you qualify for one of the…

Medicare Savings Programs (MSP)

If your income and financial resources currently are less than certain amounts, you could qualify for your State to pay for your Part B premium for you.

If your income is less than:

  • $1,469 per month as an individual, or
  • $1,980 as a married couple

AND your resources are less than:

  • $7,970 as an individual, or
  • $11,960 as a married couple

then there’s a decent chance your State can pay for your Part B premium for you.

If you’re not sure what things you can count for resources, usually it’s your assets that are liquid. This means that you should count any amounts in savings or checking accounts, CDs, investments, and retirement accounts. You should not count the value of your home, car, or other physical items.

Are your income and resource amounts less than these limits? Then, you should definitely apply for one of these MSPs. You should apply even if your amounts are slightly over these limits because you still might qualify.

There are a few different ways you can apply:

  1. Apply for Extra Help online and do NOT place an “X” in the box on question 15 where it says “No, do not send the information to the State.”
  2. Call 1-800-MEDICARE and ask to speak to the Medicaid department in your state
  3. Contact your State Medicaid department directly

For 2. and 3., your State will take you through the application process.

Part B Late Enrollment Penalty (LEP)

You’ll have to pay more for your Part B premium if you have an LEP.

How can you avoid this penalty? Two ways:

  1. Get Part B when you’re first eligible, or
  2. Be on a group health plan through an employer with 20 or more employees where you or your spouse still work

You’ll likely still have an LEP if there are less than 20 employees there. So, make sure there are.

Also, you have to be covered based on active employment. If you’re still covered by a plan once you retire and don’t sign up for Part B when you’re first eligible, you’ll likely have a LEP if you sign up later.

If you do have to pay an LEP, the longer you wait to sign up for Part B, the larger it will be. You’ll pay an extra 10% for your premium for every 12 months you wait.

For example: if you were able to start Part B in July of 2016 and wait until September of 2021 to sign up, you’ll pay 50% more for your premium.

This penalty is only due when you sign up for Part B. And, you’ll pay it as long as you have Part B the rest of your life.

Paying your Part B Premium

The easiest way for you to pay your premium is if you’re drawing any Social Security benefits, your premium will come right out of your monthly check.

If you’re not yet drawing Social Security, you’ll get a bill every 3 months. It’ll come in the mail around the 10th of the month before it’s due. There are a few different ways you can pay your premium:

  • Create an account at Medicare.gov if you haven’t already. Log in, click “My Premiums”, then “Pay Now”. You can pay using your bank account, or by credit or debit card.
  • Sign up for Medicare Easy Pay, which allows you to pay automatically every month from your bank account by electronic funds transfer around the 20th each month.
  • Mail your payment in along with the coupon at the bottom of the bill. You can pay by check or money order, or by credit or debit card.
  • Pay using your bank’s online bill pay, if they provide this service.

Also, the first bill you get in the mail will be for either 3, 4, or 5 months. If it’s for 4 or 5 months, it will be only this first bill that will be for a longer time frame. This is to get you on the same quarterly billing cycle as everyone else.

Medicare Part B: Do You Even Need it (Right Now)?

You can see from the discussion we just had about the Part B premium that it can get expensive.

Either way, it’s likely a bill you’re going to have to pay each month just to have the coverage whether you use it or not. You probably also noticed in the section about the LEP that you can avoid it by having health coverage thru work.

Which begs the question: do you need Part B right now?

If you or your spouse are still working, you’re covered under their health plan, and there are at least 20 people employed there, then you probably don’t.

But, it still might be in your best interest to get on Medicare and leave your work plan.

Some of the reasons you might want to get on Part B (and probably stop your plan at work) are because your plan through work:

  • Has high monthly premiums
  • Has large cost-sharing amounts like deductibles, copays, and max out-of-pocket
  • Doesn’t cover all the doctors you want or need to see

Some of the reasons you would want to stay on your plan and delay Part B are:

  • Your health plan costs are reasonable
  • You take medications that you don’t pay much for now, but would pay a LOT with on a Medicare Part D drug plan
  • You would lose other benefits at work by leaving the health plan
  • You would have to pay an IRMAA if you got Part B while you, or your spouse, are still working

There are a lot of things to consider if you’re first eligible for Medicare and have coverage thru work. Here’s a more in-depth article about the pros and cons of leaving work coverage at 65, along with lots of examples.

Delaying Part B: Benefits

Obviously one of the benefits of delaying Part B until after you retire is that you don’t have to pay the monthly premium.

Some people that are still covered at work don’t choose between Part B and their work plan, they get both. Paying for Part B in this situation is usually not only a waste of money, but you’re over-insured too.

If you’re going to choose to get Part B and leave your plan at work, it’ll be best to pick up a supplemental insurance policy. We’ll discuss this a bit later.

Another benefit of delaying Part B when you’re still covered at work has to do with your Medigap Open Enrollment Period. This period lets you get a Medicare Supplement (Medigap) policy without any health questions or waiting periods when you start Part B for the first time and you’re 65 or older.

If you get Part B while you’re still working, you waste this period. You could be turned down for a Medigap plan later when you retire because of pre-existing conditions.

Deferring Part B now and turning it on when you retire lets you use this period once you’re ready for it.

Delaying Part B: How to do it

If you’re not yet drawing Social Security income, delaying Part B is simple: just don’t sign up for it.

If you are drawing Social Security, you’ll be automatically signed up for Part A and Part B. You’ll get your Medicare card in the mail 3 to 3.5 months before your Medicare start date. (You’ll get it your first month Part B starts if you have Amyotrophic Lateral Sclerosis (ALS)).

When you get your Medicare card, turn it over and follow the instructions on the back to turn down Part B for now:

  • You want to check the box that says “I DO NOT WANT MEDICAL INSURANCE”
  • Sign the form, have a witness sign the form, and return it in the envelope provided before your Part B start date

They’ll mail you a new card that will say “HOSPITAL (PART A) BENEFITS ONLY”

This will most likely apply to you if you’re covered by a work health plan through your spouse, rather that if you’re the employee. This is because if you’re the one still working with good health coverage, you’re less likely to be drawing Social Security.

If you do decide you want Part B, let’s take a look at how to get it:

Medicare Part B: How to Get it

Let’s look at the different ways you can get Part B depending on when you could start:

Starting Part B When You’re First Eligible

Like we talked about in the previous section, you’ll be automatically enrolled in Part B if you’re drawing Social Security. Your Medicare card will come in an envelope from the Department of Health & Human Services, so keep an eye out for it.

Your Part B start date is based on your situation. If you’re starting Medicare for the first time because you:

  • Are turning 65, then (Part A and) Part B will start the first day of the month you turn 65. If your birthday is on the 1st of the month, Medicare will start the 1st day of the month before.
  • Are getting Social Security Disability Income (SSDI), then (Part A and) Part B will start the 1st day of the 25th month you’re entitled to SSDI.
  • Have ALS, then (Part A and) Part B will start the 1st day of the first month you receive SSDI.

If you’re turning 65 and eligible to start Medicare for the first time but you’re not drawing Social Security at least 4 months before you turn 65, then you’ll need to sign up.

You have a 7-month window to sign up, which is called your Initial Enrollment Period (IEP).

Your IEP starts 3 months before the month you turn 65, and ends 3 months after your birth month.

For example: If you were born January 8, 1956, your IEP goes from October 1st, 2020 to April 30th, 2021.

You can sign up for Medicare during your IEP using any of the following 3 methods:

Sign up Online

You can sign up online at ssa.gov/benefits/medicare.

This is the fastest and easiest way to sign up. You’ll need a my SSA account first. This method should take about 15 minutes, give or take.

Sign up Over the Phone

You can sign up by calling Social Security at 800-772-1213.

Someone will be able to help you by mailing you the paperwork you need to fill out. If someone can’t help you when you call, you can schedule an appointment to speak with someone at a later time.

Don’t use this method to sign up for Medicare if you’re in a hurry to get Part B started since it’ll take a while to talk to the right person, and receive, fill out, and main the forms.

Sign up in Person

You can sign up “the old-fashioned way” at your local Social Security office.

You can find the closest or most-convenient office using their office locator. Make sure the office is open to helping you in person since all of the offices shut down due to the pandemic in March of 2020. They are currently open on a limited basis.

If you’d like to sit down and talk with someone face-to-face, call ahead and schedule an appointment.

Now we’ll take a look at…

Starting Part B When You Leave an Employer Group Health Plan (EGHP)

The methods we just talked about apply to signing up for Medicare when you’re first eligible.

But what about if you delayed Part B because you were covered by a plan at work? Your signup process will be a bit different…

You can leave your EGHP whenever you’re ready. It can be when you or your spouse are ready to retire, but it doesn’t have to be. You can leave before if you wish.

When you’re covered by an EGHP after you’re already eligible for Medicare, you have a Special Enrollment Period (SEP) to sign up for Part B. This SEP lasts for up to 8 months after the month that either:

  • Your EGHP ends, or
  • Your (or your spouse’s) employment ends

whichever happens first.

You’ll need to fill out two forms to get Part B turned on:

  1. Part B Application (Form CMS-40B) – This form is pretty straightforward. Make sure you put the date you prefer to start Part B in question #12 for “Remarks”
  2. Request for Employment Information (Form CMS-L564) – You’ll need to fill out this form along with your employer. They will need to verify and sign off on the dates you were covered by your EGHP and your dates of employment.

If you can’t get someone in your employer’s benefits or HR department to fill out form CMS-L564, you can fill all of the form out yourself as best you can and submit it along with proof of coverage. To prove coverage, you can submit things like:

  • A copy of your health insurance card showing your policy start date
  • Explanation of benefits from your EGHP
  • Other statements like W-2’s, pay stubs, or tax returns that show how much you paid for plan premiums

It’s probably a good idea to submit one of these pieces of evidence along with the two forms even if your employer does fill out and sign their part. This can only help make the process go smoother and faster.

There are a few different ways you can turn in these forms:

  1. Go to the section “Already Enrolled in Medicare” on the Medicare page at the Social Security website. Fill out the Part B application here electronically and upload the other forms.
  2. Fax or mail your forms to your local Social Security office
  3. Take them to your local office and deliver them to someone by hand

It could take several weeks to get the forms you need, have the right people fill them out, get them to Social Security, have them processed, etc. The best thing to do is figure out when you want Part B to start and start your sign-up process about 2 months beforehand.

Starting Part B During the General Enrollment Period (GEP)

There can be several reasons you need to sign up for Part B outside of your usual Initial Enrollment Period, or Special Enrollment Period. Here are a few:

  • Your employer has less than 20 employees and you didn’t know you had to sign up
  • You don’t pay your Part B premium and it gets cancelled
  • You have benefits through the Veterans Administration, don’t get Part B when you’re 65, but decide to get it later

Whatever the reason, you can always sign up for Part B during the General Enrollment Period (GEP).

The GEP lasts every year from January 1st thru March 31st. If you sign up for Part B (or Part A) during this time, then it will start for you on July 1st of that year.

Keep in mind you may have to pay a higher premium since you could have a late enrollment penalty, like we discussed earlier.

So now that we figured out how much it costs, if you need it, and how to get it, let’s look at…

Medicare Part B: What it Covers

Since Part B is called your Medical Insurance, it will cover anything Medicare says is “medically necessary”.

This can be for lots of different types of medical services that help prevent, screen, diagnose, treat, manage, and recover from diseases and illnesses.

Let’s take a look at what Part B covers by category:

Preventive Tests and Screenings

It’s much easier, cheaper, and less painful to treat a certain health condition if you can catch it early, right?

Part B covers a lot of these tests, screenings, counseling, and vaccinations that focus on preventing disease first. Some of them are for preventing:

  • Cancer: screenings for breast cancer, cervical and vaginal cancer, colorectal cancer, lung cancer & prostate cancer
  • Heart Disease: abdominal aortic aneurysm screening, cardiovascular disease screening and behavioral therapy
  • Diabetes: blood screening to check for it, prevention program if you’re at risk, and self-management and medical nutrition therapy training if you’re already diabetic
  • Hepatitis – screenings for Hepatitis B and C, and shots for Hepatitis B
  • Misc. – screenings and counseling for various things like alcohol misuse, low bone density, depression, glaucoma, HIV infection, obesity, sexually transmitted diseases, and smoking
  • Other Common Diseases – shots for the flu, pneumonia, and Hepatitis B

Part B will cover them based on your health history and level of risk. You’re usually considered more “at-risk” if you have a family history for a certain health condition, or you currently struggle (or have struggled in the past) with maintaining a healthy lifestyle that can affect one of these conditions.

You’ll pay nothing for most of these preventive things as Part B will usually cover them in full.

Part B also covers other:

Diagnostic Tests

Sometime you may be having symptoms and don’t really know what’s wrong. Other times you may already know you have a certain health condition and need to monitor it.

For these types of situations, you may need to get various tests done to help give your doctors a better idea of what’s going on. Tests like these include:

  • Blood tests
  • Urine tests
  • X-rays, MRIs, and CT scans
  • Electrocardiograms (EKG)

Treatments

Once your doctor knows what type of illness or health condition you have, they can then order one or more types of treatments to help you manage or improve your situation.

Some of these treatments can be:

  • Chemotherapy, for cancer
  • Acupuncture, for back pain
  • Dialysis, for kidney disease
  • Drugs given to you in a medical setting like a doctor’s office or the outpatient area of the hospital. These drugs are often given to you by IV or injection.
  • Pulmonary rehab, to help manage chronic obstructive pulmonary disease (COPD)
  • Organ transplants, for a kidney, pancreas, heart, etc.

Recovery or Maintenance

If you’ve had surgery, a hospital stay, or an accident, you will need medical care to get better after you’ve been treated. Or, if you have a certain health condition, you may need care to prevent it from getting worse.

Part B covers these things like:

  • Cardiac rehab, following a heart attack, bypass surgery, an angioplasty or stent placement, etc.
  • Speech-language pathology services, to help you improve or maintain your speech, language, cognitive, or swallowing skills
  • Physical or occupational therapy, to help you improve or maintain your ability to perform everyday living activities after an injury or because of an illness

Emergency Services

Anytime you need to get medical care in an emergency, Part B will cover these services.

This includes:

  • Emergency room visits, including “observation”
  • Urgent care visits
  • Ambulance transportation, either by ground or by air

Sometimes when you go into the ER, you might stay a while. This is what’s known as “observation”. You’re not admitted to the hospital yet as an inpatient, but the medical staff doesn’t want to release you from care just yet. You may even stay in observation overnight.

Any medical care you get in observation is covered under Part B. However, if you do get admitted to the hospital, you will be covered under Part A from that point.

Durable Medical Equipment

Any medical equipment you need to get on your own and use in your life outside of a medical setting is covered by Part B.

There are lots of different kinds of durable medical equipment (DME) for things like:

  • Diabetes: blood sugar meters, test strips, insulin pumps, custom shoes or inserts, lancets and lancet devices (the prescriptions are covered under Part D)
  • Getting around: crutches, walkers, canes, scooters and wheelchairs
  • Breathing trouble: continuous positive airway pressure (CPAP) machines, nebulizers, oxygen equipment
  • Help in your home: hospital beds, pressure-reducing beds, patient lifts, and commodes
  • Prosthetics & orthotics: artificial limbs, back and neck braces, and breast prosthetics after mastectomy surgery

You’ll either be able to rent or buy the DME, depending on what it is and your situation.

Home Health Care

Part B usually covers home health care, although Part A can cover it after a stay in the hospital or skilled nursing facility.

In order to qualify for it, you must:

  • Be under the care of a doctor who creates a plan of care for you and reviews it regularly
  • Need part time skilled nursing care, physical or occupational therapy, or speech pathology services
  • Be “homebound”, where you have trouble leaving home without help

When you get approved it’s for a 30-day period of care. You can get more than one of these periods of care as you need them.

What’s NOT Covered by Part B

Part B covers anything that’s “medically necessary”.

So, what exactly does this mean?

Well lucky for us, Medicare actually tell us what this means on their website:

In the Medicare glossary, medically necessary means “health care services or supplies needed to diagnose or treat an illness, injury, condition, disease, or its symptoms and that meet accepted standards of medicine.

This means Medicare won’t cover tests, treatments, procedures, equipment, etc. that don’t meet accepted standards of medicine because they are used:

  • more often than is standard
  • to try and treat or diagnose something in a way that is not the standard way
  • to care for someone with an illness or condition rather than diagnose or treat them
  • as general checkups, rather than to diagnose a specific medical issue

This just gives you an idea of some of the reasons Medicare may deny your medical claim.

Some more specific things that Medicare doesn’t cover are:

  • most dental care
  • routine eye exams
  • cosmetic surgery (except for bariatric surgery for morbidly obese people with certain health conditions)
  • hearing aids and exams
  • long-term care
  • massage therapy

Now that we have a good idea what things, or types of things, Medicare covers, let’s look at what we should expect to pay for these things…

Medicare Part B Costs: Deductibles, Coinsurance, and More

Some of the Part B out-of-pocket expenses are very easy to understand. Some others? Not so much.

Let’s look at the easy ones first:

Part B Deductible

The Part B deductible is something you owe in full before Medicare pays their part.

Now, many of the preventive tests, screenings, and home health care services we went over earlier will be covered 100% by Medicare. This means you don’t have to meet a deductible first and there is no cost to you.

However, everything else covered by Part B requires that you (or your secondary insurance) pay this deductible first before Medicare will share in your cost.

Right now, the Part B deductible is $203 for the entire year. It starts over each January 1st.

After you meet your deductible, then the rest of the year you’ll have to pay the…

Part B Coinsurance

Have you ever heard that you need insurance to pick up “the 20%”?

That’s what this section talks about.

After you meet your deductible, then Medicare pays 80% of any of your Part B expenses the rest of the year. Your 20% responsibility is called your Part B coinsurance.

The big problem with this 20% is that it is unlimited! You’ll pay 20% of any Part B claims no matter how much they are.

Now, you can get secondary insurance to cover this coinsurance, but we’ll talk about that a bit later.

Part B Excess Charges

Almost all doctors and other healthcare providers agree to accept Medicare’s approved payment amount in full for their services, and to be paid directly by Medicare. This is called assignment.

There are a small number of healthcare providers that don’t accept Medicare assignment, and charge a bit more for their services.

The 2 risks you run when you see a provider that doesn’t accept assignment are:

  1. You may have to pay the provider in full first, and then try to get Medicare to pay you back, and
  2. You may have to pay an excess charge

Excess charges are a small percentage more than the assignment amount. The way to figure it out is to first take 95% of the assignment amount. Then, multiply this number by 15%.

For example: if a doctor performed some type of treatment that had an assignment amount of $460, the excess charge would be $65.55 ($460 x 0.95 = $437; $437 x 0.15 = $65.55).

Now that we’ve seen what our cost-sharing amounts are under Part B, let’s see how we can get insurance to pay instead of us…

Supplemental Coverage to Part B

Your two main types of supplemental insurance plans to pick from will cover Part B very differently. Let’s first look at:

Medigap Plans

Medigap Plans will pay for most of the Part B deductible, coinsurance, and excess charges for you.

You can see in the chart below what percentage these plans will pay for the:

  1. Part B deductible: only Plan C and Plan F pay this amount for you
  2. Part B coinsurance: all Medigap plans pay for at least part of this amount. Plans K & L pay 50% and 75%, respectively. Plan N pays 100%, except for up to $20 for each doctor’s visit copay and up to $50 for each emergency room visit copay.
  3. Part B excess charges: only Plan F and Plan G pay these amounts for you

Medicare Advantage (MA) Plans

MA Plans can cover Part B costs very differently from one plan to the next.

MA Plans basically replace Part B (and Part A) of Medicare. So, they’re allowed to decide what you pay for Part B services.

Some MA plans cover most things like doctor’s visits, lab tests, diagnostic radiology, urgent care, physical therapy, etc. in full leaving you $0 copay. Other plans require you to pay some copay or coinsurance almost every time you use your plan.

It really depends on where you live and what plans are available in your area.

Of course, MA plans will still give you all the same preventive tests and screenings covered by Medicare in full at no cost as well.

If you have a bad health year, MA plans do set a limit on what your total out of pocket expenses for the year can be.

Medicare Part B: Things to Watch Out For

Just like with Part A, there are a few important things to be aware of with Part B.

Ignoring these things could cost you extra dollars out of your pocket and prevent you from getting the coverage you need when you need it. Let’s look at a few:

Signing Up For Part B Right After Your 65th Birthday

If you’re first eligible for Medicare when you turn 65, then Medicare will start the first day of the month you turn 65.

When you sign up for Part B any time in the 3 months prior to your birth month, Medicare will start on the first of this month.

However, if you sign up for Part B any time during your birth month or in the 3 months to follow, your start day might not be when you think it will be. Signing up for Part B in any of the last 4 months of your Initial Enrollment Period (IEP) will cause Part B to start according to the chart below:

For example: You turn 65 on July 23rd and you sign up for Part B in September. Part B won’t start for you until December 1st.

You can see how this could be a problem. If you’re not careful planning when you leave, or lose, your old insurance, you may go a month or more without medical coverage.

One other thing to be aware of is that if you still are covered by a health plan from work during this time, you do not need to fill out the Request for Employment Information (CMS L564) form we discussed earlier. You only need to fill out this form if you sign up for Part B during a Special Enrollment Period.

Signing up in your birth month or 3 months after still has you in your IEP. You do not need to fill out the CMS L564 form if you sign up for Part B in your IEP. The person you talk to at Social Security may tell you different. They’re wrong.

COBRA

COBRA stands for the Consolidated Omnibus Budget Reconciliation Act.

It doesn’t really matter that you know what is stands for. Just know that COBRA lets you continue your health insurance from work a little while after work ends. This could be from a job that you or your spouse just left.

COBRA usually lasts for up to 18 months. However, there are some cases where you can keep it for up to 3 years.

But, if you’re eligible for Medicare, going on COBRA instead of getting Part B (and Part A) along with a supplemental policy is usually a bad idea.

Not only is COBRA usually very expensive. But also, the clock starts ticking for you when you leave work. You only have 8 months after the month your (or your spouse’s) employment ends to sign up for Part B.

If you continue on COBRA, you may not realize this. You might be looking for another job, so you don’t sign up for Part B just yet. Or, you could just think that having COBRA lets you get Part B whenever you want.

If you don’t sign up for Part B within this 8-month window, even if you have COBRA, you’ll have to wait under the General Enrollment Period of January 1 to March 31 to sign up. Part B would then start on July 1 and may leave you with a late enrollment penalty.

Veterans Administration (VA) Benefits

You may have VA benefits for healthcare coverage.

First of all, thank you for your service!

If you’re happy with your coverage through the VA, you may not be thinking about getting a supplemental insurance plan. You might not even be thinking about getting Part B since you have to pay for it.

I would ask you to reconsider.

Having VA coverage will allow you to avoid a late enrollment penalty for Part D, but not for Part B. So, if you change your mind and want Part B years later, it’ll cost you.

Like any Medicare topic, we could dive even deeper into Part B. But I think we’ve covered the ins and outs pretty well here. If you have any questions, just send me a message in the box at the bottom of the page or give me a call at 866-240-8639.

 

 

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