So you are turning 65 and now the Coronavirus pandemic has hit and you are wondering, what do I do now? You have many options and as we are all trying to find ways to live, work, and get our affairs in order in this environment technology has become the go-to medium of communication.
The onset of Coronavirus has posed many challenges and barriers for new Medicare Beneficiaries. With the local centers closed or with limited hours, many had to resort to applying for Medicare online or over the mail. It is estimated that among internet users ages 65 and older, 70% use the internet on a typical day. Many consider themselves “old school” and prefer to meet with someone face-to-face. However, COVID has forced many to resort to handling their affairs over the phone or online.
Here are a few things you need to know if you are new to Medicare
1. Medicare is Individual Coverage
Medicare is an individual plan and covers beneficiaries who turn 65, are on social security disability for 24 months, have Lou Gehrig's disease or End-Stage Renal Disease (ESRD). If your spouse or dependents are on your current ACA or Group plan, you should consult with your benefits administrator or insurance agent to determine the best course of action to take.
2. You May Not Automatically Qualify for Medicare
If you are not currently receiving social security, you may need to apply for Medicare. You are generally eligible to apply for Medicare 3 months before your 65th birthday and can actively enroll in a plan 3 months before, the month of, and 3 months after your birthday. This can be done by visiting a local social security office or applying online at https://www.ssa.gov/benefits/medicare.
3. Medicare is Not Free
It is important to note that everyone’s situation is different. We cannot emphasize that enough. Your situation may be different than your next-door neighbor and there are so many factors to consider that make you unique. This includes the amount of time you worked and earned employment credits as well as your doctors, prescriptions, and financial situation.
What are the employment quarters?
The social security administration considers One employment quarter is equal to three months and there are 4 quarters in a year (Jan-Mar, April-June, July-September, October-December). The Social Security Administration (SSA) also refers to a “quarter of coverage” (QC) as a “Social Security credit.”
How Much Do You Need to Earn to Get Employment Credits?
The number of earnings it takes to earn credit may change each year. In 2020, you earn one Social Security or Medicare credit for every $1,410 in covered earnings each year. In a nutshell, you must earn $5,640 to get the maximum four credits for the year.
If I don’t have enough credits?
The number of quarters you paid Medicare taxes will affect your Medicare costs, however. Your Medicare Part A premium is partly based on the number of quarters for which you worked and paid Medicare taxes. As mentioned above, you qualify for premium-free Medicare Part A if you paid Medicare taxes for 40 quarters. If you paid Medicare taxes for less than 40 quarters, you will typically have to pay a premium for your Part A coverage.
In addition, you must have 40 Quarters (10 Years) of employment credit to qualify for premium-free Medicare Part A coverage.
4. Medicare VS Social Security
People who are older, or are disabled, can automatically qualify for Social Security benefits. These benefits can help them supplement their income if they become disabled, or choose to retire. It is important to note that Social Security is the income component of your retirement or disability benefits while Medicare covers the medical component. If you are currently receiving Social Security and qualify for Medicare, you will automatically be enrolled in Medicare.
5. You Are Covered Through Your Employer
If you have group coverage, the rule of thumb is to contact your benefits administrator to see if your insurance is creditable. This means that the coverage must be as good as the standard Medicare coverage or better. If your medical or prescription drug coverage is not creditable, you must enroll in Medicare Part A or Part B and choose a Prescription drug plan to avoid paying a late enrollment penalty.
6. US Citizens and Legal Residents
Legal residents must live in the U.S. for at least 5 years in a row, including the 5 years just before applying for Medicare. You must also meet the eligibility criteria to apply for Medicare.
If you’re new to medicare or would like to discuss your options, click here to schedule a consultation.