Information for when an employee or covered spouse turns 65
When you turn 65 and become eligible for Medicare, there are new options to consider regarding your health coverage.
If you continue to work after 65*, you will have choices regarding the Congregational Employee Plan (CEP) health coverage as part of The Corinthian Plan, or coverage through Medicare and a Medicare supplement plan.
While this document provides general information about these topics, it should not be considered a recommendation for any one decision.
The Corinthian Plan CEP health coverage as primary
If you choose to remain on The Corinthian Plan CEP health coverage as your primary coverage, you may also be enrolled in Medicare Part A. Your local Social Security office can provide more information about Medicare benefits – including when you would be enrolled in Part A, and if Part B would also benefit you. If you enroll, Medicare will coordinate benefits with The Corinthian Plan CEP health coverage, which will be your primary coverage, and Medicare as secondary.
Medicare coverage as primary
If you choose Medicare as your primary coverage, you will need to cancel The Corinthian Plan CEP health coverage. While you will be automatically enrolled in Part A (if you are receiving Social Security benefits) you may want to consider signing up for Part B as well, for maximum protection. By law, an employer may not provide incentives or subsidies for an employee to terminate employer coverage and enroll in Medicare as primary. The employer may not pay for Medicare Part B coverage or the premiums or costs associated with a Medicare supplement policy. You or your spouse are responsible for those expenses.
Medicare Part D prescription drug program
Medicare Part A, Part B, and Medicare supplement policies do not cover prescription drugs. So if you elect Medicare as your primary coverage and enroll in a Medicare supplement plan rather than stay on The Corinthian Plan CEP health coverage, access to prescription drug coverage is available from a Medicare Part D plan – at a cost generally from $20 to $80 per month.
General paying scenarios
The following scenarios generally show how Medicare will pay when it is the secondary coverage. However, you should consult with a Medicare representative for precise information. Generally, as the secondary payer, Medicare will pay the
lesser of scenario A or scenario B.
Scenario A
For Part A charges (Inpatient hospital)
The Medicare approved amount
Less the Medicare Part A deductible ($1,132 in 2011)
For Part B charges (Outpatient services)
The Medicare approved amount
Less the applicable Medicare Part B deductible and coinsurance ($162 deductible _ in 2011, coinsurance is 20 percent of the Medicare approved amount)
(Basically, in this scenario, Medicare will not pay more than it would have had it been the primary payer.)
Scenario B
For Part A and Part B charges
The Medicare approved amount
Less the payments made by The Corinthian Plan CEP health coverage
Premiums
Medicare Part A generally requires no premium payments. Medicare Part B has a standard monthly premium of $115.40 for new enrollees in 2011 (generally indexed each year for inflation). Most people that stay on employer coverage that pays as primary (such as The Corinthian Plan CEP health coverage) often delay enrolling in Part B. There is no penalty for late enrollment in Part B if you apply within eight months of stopping The Corinthian Plan CEP health coverage.
HSA contributions and Medicare
If you contribute to a health savings account based on your health plan design – and if you are enrolled in Medicare Part A or Part B – you may no longer contribute to an HSA. However, you may still take distributions from the HSA. You may want to consider this in decisions about enrolling in Medicare Part A or Part B.
If you remain an employee and still want to contribute to an HSA, contact your local Social Security office – before you turn 65 is recommended – to waive Medicare Part A coverage.
Additional resources
You can find more information about Medicare at www.Medicare.gov or through your local Social Security office.
*This information is generally also applicable to the spouse of an employee who is turning 65.