When retirement is on the horizon, you start planning for the years when you no longer have a job. And without employment, you’ll need to find alternative medical coverage. Luckily, if you’re a U.S. citizen or legal permanent resident and at least 65 years of age, you may be able to enroll in Medicare.
Medicare is a lifesaver when you retire and no longer have employer-sponsored health insurance. However, it’s not without its downsides. Many seniors decide to opt for certain medical procedures while still on their company’s coverage as a way to save money in the long run.
Procedures to Get Before Swapping to Medicare
Medicare enrollees typically have higher deductibles, copays, and overall insurance costs. Similarly, when compared to insurance plans through the Affordable Care Act (ACA), Medicare Part B premiums can be higher.
Medicare has limited dental, vision, and hearing coverage.
- Major Dental Work – Medicare usually does not cover routine dental care, extractions, root canals, or crowns, so you should plan to get implants, bridges, and dentures while you have other coverage.
- Vision Aids – Update your prescription and get new eyeglasses or contact lenses because Original Medicare also doesn’t cover those, except in specific circumstances.
- Hearing Aids – These are very expensive and Original Medicare rarely covers them.
Medicare does not have out-of-pocket caps, so major surgeries can cost more than they would under employer-sponsored plans.
- Joint Replacement – Knee and hip replacement surgery will typically cost up to your deductible. You should plan the surgery if you have a low deductible or have already met it for the year. On Medicare Part B, there is a 20% coinsurance and no cap (unless you have a Medigap supplement; learn more below).
- Minor Procedures – Elective procedures, like sinus surgery, bunion removal, and varicose vein treatments, are easier to navigate under private coverage than waiting for Medicare approvals.
- High-End Diagnostic Imaging – Medicare has very strict guidelines, so if you want a scan that isn’t considered medically necessary, like a preventive full-body MRI screening or a non-mandatory mammogram, then you’re better off doing it under a private plan.
Medicare also does not enroll dependents, so if you have a spouse or children on your employer-sponsored plan, they’ll be uncovered.
Procedures to Wait Until You Are on Medicare
Original Medicare covers most medically necessary services and supplies, and Medicare Advantage covers what Original Medicare covers plus extra benefits. And in most cases, you don’t need prior authorization.
- Medicare completely covers (that means it’s free) your first “Welcome to Medicare” visit and annual wellness visits. These visits include a health risk assessment, review of your medications and providers, blood pressure check, and health advice. However, the provider may charge for additional tests or to treat a specific condition.
- Medicare also doesn’t have a deductible or copay for routine cancer screenings, including colonoscopies (every 10 years), mammograms (for women older than 40), prostates test (for men older than 50), and bone density scans.
- If you have Medicare Part B, flu and pneumonia vaccines are free. And if you have Medicare Part D, shingles and tetanus vaccines are free.
- Cataract surgery is one of the most common procedures Medicare covers. It also covers a pair of eyeglasses or contact lenses after the surgery, which is usually not covered.
And if you don’t have any insurance coverage, it might be worth waiting to schedule appointments until you’re enrolled in Medicare. Just don’t wait if it’s a life-threatening emergency or if postponing could cause irreversible damage to your well-being.
Costs to Keep in Mind Before Transitioning to Medicare
Medicare Part A is typically premium-free, whereas most employer-sponsored and ACA insurance plans require a monthly payment. However, if you haven’t worked at least 10 years to earn 40 work credits, then you will need to pay a monthly premium of either $311 (if you have 30 to 39 credits) or $565 (if you have less than 30 credits).
You will need to pay for Medicare Part B, and the standard premium is currently $202.90, which may be more or less than other coverage. If you earn more than a certain amount, you will have a surcharge, which is currently:
- $284.10 if you make $109,001 to $137,000 (individual) or $218,001 to $274,000 (joint).
- $405.80 if you make $137,001 to $171,000 (individual) or $274,001 to $342,000 (joint).
- $527.50 if you make $171,001 to $205,000 (individual) or $342,001 to $410,000 (joint).
- $649.20 if you make $205,001 to $499,999 (individual) or $410,001 to $749,999 (joint).
- $689.90 if you make more than $500,000 (individual) or more than $750,000 (joint).
Like Part B, Medicare Part C and D have surcharges for higher earners, which can currently increase the monthly charge by $14.50 to $91. The standard premium for Part C depends on the plan you select. And the current national base premium for Part D is $38.99.
But if you have low income and resources, you may qualify for Medicare Savings programs.
What to Do With Your Health Savings Account Plan Before Getting Medicare
You cannot contribute to an HSA once you enroll in Medicare. And, you may have to deal with tax implications if you still contribute to it within six months of enrolling.
Since an HSA rolls over from year to year, you could have thousands of unused funds in your account. You can still use the funds in your account to pay for Medicare premiums and out-of-pocket medical expenses.
How Medigap Can Save You on Major Medical Costs (Because You Can’t Plan for Everything)
While it is smart to handle major surgeries before retiring, sometimes you cannot avoid a procedure. Original Medicare has no out-of-pocket maximum, so if you have a $100,000 hospital stay, you could be responsible for $20,000 in coinsurance.
Medicare Supplement Insurance, or Medigap, is extra coverage that helps share your out-of-pocket costs and once you reach your limit, it pays for services for the rest of the year. It also protects you from companies denying coverage or charging more for pre-existing conditions.
By Admin –