This piece is presented by Sanford Health.

A person’s 65th birthday is an important turning point – for the individual as well as for his or her employer. In past decades, Americans have more commonly worked past Medicare eligibility. And Sanford Health Plan is here to help employers understand the unique Medicare guidelines for this age group. 

Medicare

Established by Congress in 1965, Medicare provides health care coverage for people 65 and older and certain younger individuals who have specific disabilities or end-stage renal failure.

“Medicare is financed through payroll taxes paid by workers and employers,” said Jennie Nickles, individual sales and marketing manager at Great Plains Brokerage. “And the coverage is similar to private insurance companies, paying a portion of medical care costs. Often, the beneficiary pays a deductible and co-insurance.”

Enrollment period

Nickles explains a person has a seven-month period to initially enroll — starting three months before turning 65, including the birthday month and ending three months later.

Four major programs are included: Part A covers hospital stays, Part B covers physician fees, Part C allows beneficiaries to receive medical care from among a number of delivery options, and Part D covers prescriptions.

Primary or secondary provider

In companies with 19 or fewer full- and part-time employees, Medicare is always the primary payer, and employees turning 65 must enroll in Medicare Parts A and B. If they do not, the employee is responsible for medical expenses that Medicare would cover. In larger companies, there are various rules determining whether a group plan is the primary or secondary payer.

Medicare rules to note

• Medicare-eligible active employees and their spouses must be treated the same as non-Medicare eligible ones. An anti-discrimination clause protects active working Medicare-eligible individuals from receiving less coverage than non-eligible co-workers.
• Medicare-eligible employees cannot be offered reduced coverage while offering comprehensive coverage to other employees.
• Medicare-eligible spouses of active employees cannot be removed from an employer group plan nor have Medicare pay as the primary insurer for those individuals.
• A statute exists ensuring Medicare benefits are secondary to employer plans for nonretirees.
• Medicare payments are not allowed for services for which it can be reasonably expected the payment be made by a group health plan. Medicare’s designation as the secondary insurer is upheld even if state law or the group health plan states its benefits are secondary to Medicare.
• If any employee eligible for Medicare opts out of employer group health plan coverage, Medicare becomes the person’s primary insurer.
• A penalty – per individual – may be imposed against any employer found offering financial incentives for Medicare-eligible individuals to opt out of the group health plan.

“The goal is to protect the individual eligible for Medicare and ensure the same access to health care coverage as a noneligible employee,” Nickles said.

Sanford Health Plan can help by working hand-in-hand with an employer, offering support and resources, including on-site educational seminars.

Visit sanfordhealthplan.com to find out more.