Retirement

Steer Clear Of Medicare Misinformation And Avoid Costly Mistakes

Early in the new year, a severe winter storm warning for our area resulted in the closure of my grandsons’ schools, cancellation of business meetings, and a grocery store run on milk and essentials. What happened? Instead of blizzard-like conditions and a foot of snow, we got three inches of rain and mid-30s temperatures.

I often wonder how it feels to have a job where what you say, even if wrong, can have such an impact. Wait a minute! I do; I work with Medicare.

Medicare misinformation is widespread. It seems that if the source has any connection to seniors, any Medicare tidbits are considered credible. And, if that information turns out to be wrong, the repercussions can be serious.

One common topic for which people seek advice is whether or not to enroll in Medicare. Because missing the enrollment window can mean no coverage for medical bills, significant out-of-pocket costs, and late enrollment penalties for life, the right timing is critically important.

Too many sources of misinformation

Here are just a few samples of the misinformation surrounding Medicare enrollment you can find on the internet.

There are exceptions to the rule (that everyone must enroll). If you or your spouse is still working and has healthcare coverage through an employer or other creditable source, such as an individual healthcare plan, you can delay Part B without a penalty.

A national retirement planning company posted this. There is no rule that everyone must enroll in Medicare at age 65 and, if there were, there would be only one exception The person has a group health plan sponsored by a company with 20 or more employees that is based on his or her current employment or that of a spouse. An individual plan may be considered creditable coverage but it does not qualify one to delay Medicare enrollment.

It’s important to note the source for the comment about an individual health plan being creditable so enrollment could be delayed. It was simply healthcare.gov’s definition of creditable coverage and did not mention delaying Medicare enrollment.

Late to enroll in Medicare Part B? Job-based insurance, COBRA coverage, or even your spouse’s active health plan can help dodge penalties.

A Medicare expert for a national news site wrote this piece of misinformation. Job-based insurance or the spouse’s active health plan must be an employer group health plan, as noted in the previous example. And no way is COBRA coverage a basis for putting off Medicare.

In most cases, if you don’t sign up for Part B when you’re first eligible, you’ll have to pay a penalty—and not just upon enrollment. You’ll continue to pay that penalty for as long as you’re enrolled in Medicare Part B.

This appeared on the website for a large sponsor of Medicare plans. What’s wrong with this one? “Most cases” is not quantified, so to avoid any penalties, some enroll in Medicare even though they could delay.

Besides issues with the internet, clients have shared with me the misinformation they hear in conversations with employers, insurance agents, advisors, and friends. It’s usually along the same lines: you must enroll at age 65, or you don’t have to enroll.

Recently, I heard a new twist worth sharing. An HR representative told a client that they can’t force him to enroll in Medicare. (His plan is sponsored by a company with 20 or more employees.) So, for that reason, he can’t drop the employer plan because it will look as though the company forced him onto Medicare.

Of course, that is also misinformation. His company cannot make him enroll in Medicare but it cannot stop him if he decides that Medicare is a better option.

What to do about misinformation?

The internet can be a great source of information to help you understand Medicare, but you have to be smart.

  • Start your research with medicare.gov, cms.gov, and ssa.gov. These sites are not the easiest to navigate and, sometimes, you will need to put together pieces from multiple pages. But these are the sources behind the rules.
  • Validate any information you get from non-governmental sources. Either track down the information on a government site or find at least one other reputable source that says the same thing.
  • Check out the footnotes to verify that they are credible sources and support the information. I just found this on another insurance website. “If you have other creditable coverage, you can delay Part B and postpone paying the premium.” Creditable coverage was a hyperlink to a page on creditable prescription drug coverage and the Part D late enrollment penalty, and not a single word about Part B.

There are two points that apply here. One, Medicare is very complicated and, two, people are reluctant to deal with it. However, Medicare has many moving pieces and that’s why everyone must deal with it carefully. Take time to learn the genuine (not someone’s alternate) facts that apply in your situation.

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