Medicare Open Enrollment has Begun: Are You Ready?

Amidst the global pandemic, unemployment has reached historical highs leaving millions of Americans without access to health insurance. In our recent blog we highlighted different options for health coverage in case of loss of employment.

Medicare open enrollment kicked off on October 15 and we want to share information to help you prepare.

As with most enrollment periods, you may have questions about plan options and if Medicare enrollment may affect participation in employer-sponsored benefits. Help is here to untangle the mysteries of Medicare open enrollment for you and your employees!

How long is the open enrollment period for Medicare?

Medicare open enrollment begins each year on October 15 and ends on December 7.

What are the requirements to be eligible to enroll in Medicare?

Eligibility for Medicare requires that the beneficiary be:

• 65 years of age;
• Disabled for a period of 24 months; or
• Be diagnosed with either end-stage renal disease or Lou Gherig’s disease.

How does someone enroll in Medicare?

Medicare enrollment is done via Social Security. The beneficiary can enroll online at www.ssa.gov or contact their local Social Security office by phone. The national number is 1.800.772.1213. (Note: Due to COVID-19, all Local Social Security offices are currently closed to the public. To find the phone number for your local office, refer to the Social Security Office Locator.)

What if an employee intends to work past 65? Should the employee still enroll in Medicare?

That depends. If your company has 20 or more employees, and your plan is sponsored by a large group employer, an employee can delay enrollment. The employee must be enrolled in active coverage through a large group employer that is considered “creditable”. Employees that obtain their benefits through a larger entity such as a Multi-Employer Welfare Association (MEWA) or a Professional Employer Organization (PEO) may also be able to delay enrollment even if their employer has less than 20 employees. To be certain, contact your plan sponsor for assistance.

How does the employee find out if their coverage is “creditable?”

Annually, and no later than October 15, employers are required to provide a Medicare Creditable Coverage Notice to all employees who are 65 or older or are disabled. The notice pertains to any members of the household enrolled in employer coverage who may be eligible for Medicare or will be eligible in the coming year. Coverage is considered “creditable” if the employer prescription drug plan is as good as or better than what Medicare offers.

Can a company encourage a Medicare eligible employee to enroll in Medicare and drop the employer-sponsored coverage?

No. The Medicare Secondary Payment regulations prohibit employers from discouraging Medicare eligible employees from enrolling in the company-sponsored health plans. Employers are also prohibited from offering an incentive to employees to waive company-sponsored health plans and enroll in Medicare.

Can an employee keep their employer-sponsored coverage and still enroll in Medicare?

Yes. The employer-sponsored coverage would be primary (pays first) when services are rendered, and a claim is incurred.

What if an employee is not sure what to do and wants help?

It is mandated by Congress that every state provides a State Health Insurance Program or SHIP, to assist Medicare beneficiaries with decisions concerning Medicare and even questions that arise after enrollment. Click here to find your local SHIP. Assistance from this program is free, and unbiased. It is sponsored by your state’s Agency on Aging. For questions regarding how Medicare will interact with employer-sponsored coverage, employees should contact the insurance carrier at the number on the back of their ID cards or their plan sponsor for assistance.

Employees can also access the National Council on Aging “My Medicare Matters” site. The site includes an assessment that can be utilized to determine what options may be right for an employee’s individual needs. The site also provides a detailed enrollment guide which can be especially helpful to employees that are new to Medicare.

Despite our busy lives, open enrollment is an important period that should not be rushed. A survey by Aflac revealed that Americans spend 15 minutes or less researching benefit options during open enrollment season. In contrast, Americans can spend as much as 10 hours researching the purchase of a new car, or which television to buy. Open enrollment is the period during which an individual’s access to coverage is determined for the coming year. It’s a good idea to help employees become better consumers of all types of healthcare, particularly during these challenging times as they may feel vulnerable and should be aware of their options.

This communication is for informational purposes only; it is not legal, tax or accounting advice; and is not an offer to sell, buy or procure insurance.

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