Thursday, May 20, 2010

Medicare and Other Health Insurance

Choosing Medicare or Group Health Coverage

QUESTION: I am retiring in a few months. I am covered on my wife’s group health plan through her job. Should I stay on my wife’s insurance or go on Medicare?

ANSWER: There are a couple important things to consider in making your decision.

First, determine if Medicare is primary or secondary to your insurance.

The number of people employed usually determines if Medicare is the primary insurance or the secondary insurance. Medicare is usually (but not always) secondary to insurance provided by businesses that employ a large number of people. Medicare is primary to insurance provided by small employers (less than 20 employees). If Medicare is secondary to your insurance, there is a good possibility you will be better off staying on your current plan. If Medicare is primary its probably not going to be the best value cost wise. Your employer’s HR department can tell you if Medicare is primary or secondary to your insurance.

Your premium cost is another consideration. Compare the cost of both options and the benefits provided. Medicare will cost, on average for a 65 year old, around $250 per month for Medicare Part B premiums, a Medicare supplement and a Part D Prescription Plan.

SOURCE: Medicare and Other Health Benefits: Your Guide to Who Pays First, A booklet available from The Centers for Medicare & Medicaid Services. I will be happy to e-mail you a copy of the booklet. Click the “Ask A Question” button and request “Who Pays First” Booklet.