Can I Select a Medicare Plan If I Have Group Coverage?

Some workers will become eligible to enroll in Medicare yet have other health insurance coverage, generally provided through their employer. In this case, the decision to enroll in Medicare depends on several factors, such as personal choice, how much to pay in premiums, the extent of current coverage and the current rules for provider coverage.

Group Insurance Rules

• If you reach the age of eligibility for Medicare enrollment but you still have coverage under a group or union insurance program, you must know your provider's rules before you enroll in Medicare. Some group insurance providers do not work with Medicare. If this is the case, you cannot enroll in Medicare and continue with your group insurance. If you decide to enroll in Medicare, your provider will drop your coverage, and you might not be able to get it back. If you decide not to enroll in Medicare, you can enroll once your group insurance coverage ends. If your plan works with Medicare, you can enroll without problems and have both types of coverage. If you have both, your private insurance must pay for medical procedures before Medicare pays.

Coverage

• If your group insurance allows you to enroll in Medicare, you might still want to consider a few factors before you do so. You need to consider the coverage you have with your current group insurance and the coverage you can have with Medicare. If enrolling in Medicare is not adding any additional coverage to what you have with your group insurance plan, enrolling in Medicare might not be necessary at this point, and you should wait until your group insurance coverage ends. If Medicare adds coverage you do not get from your group insurance, then enrolling might be a good idea.

Premiums

• Keep in mind that only Medicare Part A (hospital insurance) is free and only if you have paid Medicare tax. Other Medicare coverage requires payment of monthly premiums. You must consider whether or not your income allows you to pay your group insurance premiums plus Medicare premiums. If you have the necessary income to pay both premiums, you must analyze the coverage and premiums together. If Medicare adds coverage you do not have with your group insurance, it might be worthwhile to pay the premium if you have the income to do so. Medicare has programs that help you pay for premiums and deductibles. If you do need Medicare coverage, you might want to apply for supplemental coverage.

Late Penalty

• If you choose not to enroll in a Medicare plan because you have group insurance coverage, you can enroll in Medicare once your plan ends. However, this only works for Medicare Part B. If your group insurance coverage does not have prescription drug coverage and you do not enroll in a prescription drug plan through Medicare Part D, you are required to pay a late penalty when you do enroll in a Part D plan.