Retirement Considerations for
Employees
Sandy Ruffo, RN
Statewide Health Insurance Benefits Advisors
(SHIBA)
• Role of SHIBA
• Handouts
• Key concepts to be discussed
Common terminology
Critical timelines and rules
Employee choices
Employer advise to
employees
The Terminology
• “Hospital Benefit”
• No cost
Eligible age 65
Disabled X 2 years
Medicare Part A
• “Medical Benefit”
• Monthly premium: $93.50 in
2007
Premium higher for incomes
over $80,000/$160,000
The Terminology
Medicare Part B
• Drug Coverage (57 plans Pierce) – offered for
Original Medicare only
• Varies by plan Formulary and price Deductibles and co-pays Coverage in gap period varies by plan Contracted pharmacies
• Untimely enrollment = penalties
Three parts (A-B-D) referred to as Original Medicare
Plans • Part C is not considered “Original Medicare”
The Terminology
Medicare Part D
• Medicare Advantage Plans – Medicare Health Plans – MC + Choice Plans (16 Pierce)
• Part B required
• In Medicare program – have MC rights and
protections
• Includes Medicare A and B benefits + may have
extras
• Drug coverage varies by plan; OOP costs vary by plan
The Terminology
Medicare Part C
The Terminology
• Insurance supplements for Original
Medicare benefits – not MedAdvantage
Plans
• OIC approved carriers (22)
• 12 Standardized Plans (A though J)
Hospital/outpatient co-insurance/co-
payments
SNF co-insurance
Part A and B deductibles
Medicare Supplements/Medigap
The Terminology
• Government Sources DSHS Medicare Savings (Part B costs) Extra Help (Part D prescription)
• Non-Government Sources
Foundations for chronic disease
Pharmacy Assistance Programs
Charities
Limited Income/Resource Programs
Drug Plan
• Employer drug plan: as good or better than Medicare
• Employer to provide employee with letter
Medigap Plan
• Health coverage employee had before applying to
Medicare
√ Not discount cards, specific disease insurance, LTC
insurance
The Terminology
Credible Coverage
Timelines to Watch
Part A Enrollment
3 Months BeforeBirthday
BirthdayMonth
3 Months AfterBirthday
• Not tied to obtaining Social Security benefits
• SSA sends info packet
Employee not auto enrolled (unless getting SS)
Rules:
If working after age 65, not mandatory
If to retiree plan, required to enroll
• Unsolicited advice
Timelines to WatchPart B Enrollment
• Critical: What is employer plan requirement? When employer plan pays – before or after Medicare?
• Employee can delay Employer coverage primary Under spouses insurance
• Rules: If working after age 65, not mandatory If to retiree plan, required to enroll
• Critical: If enrolls Triggers open enrollment period for Medigap
• If delays due to employer coverage, has 8 months
• Or 63 days after employer coverage ends
• Penalty of 1% of national average premium (2007: $27.35)
per month
Enrollment limited to Open Enrollment period (11/15 to
12/31)
Effective January 1st
• HR change plan prescription drug parameters
Ensure coverage credible; if not employee penalized
Timelines to WatchPart D Enrollment
3 Months BeforeBirthday
Birthday Month
3 Months After Birthday
Not keeping any employer coverage:
• Initiate Part A and B enrollment, then
• Enroll in MedAdvantage Plan
• Miss this period = only during Open Enrollment
period
Timelines to WatchPart C Enrollment
3 Months BeforeBirthday
Birthday Month
3 Months After Birthday
Not keeping any employer coverage:
• Part B triggers – 6 months to enroll Guarantees Pre-existing conditions
• Late enrollment Higher premium potentialAnnual Open Enrollment period
• Reminder: employer plan requires Part B =
impacts Medigap
• Medigap Protections Have employer coverage Move in and out of MedAdvantage Plans
• Leave Medigap protections – 63 days to enroll
Timelines to WatchMedigap Enrollment
Employee Choices On Retirement
• Employer Retirement Plan
Consider benefit parameter changes;
decrease
Price
Spouse coverage
COBRA an option
Drug coverage credible
Obtain benefit book
Employee Choices On Retirement
• Original Medicare Plans Plus Supplement
Part A, B and D
Medigap Supplement
Monthly average 2007: $254
Employee Choices On Retirement
• Medicare Advantage Plans (Part C)
Purchase Part B
Plan premium (with and without drugs)
Medigap insurance not needed
Monthly average 2007: $231 (for plan
which offer above Medicare)
Advising Your Employees
• Retirement before age 65 (not Medicare
eligible)
Spouse coverage needed
Employer plan cost versus individual
insurance
Disability a factor
Limited income/resource programs
Assistance with drug prescriptions
Advising Your Employees
• Retirement at age 65
Employer health plan offered
Remind: enroll Medicare Part A
Decisions made on Part B –
trigger Medigap Open Enrollment period
Drug coverage credible
Advising Your Employees
• Retirement over age 65
Timely enrollment in Part B
Decide Original Medicare or MedAdvantage
Plan
Q & A?
SHIBA Hotline
253.596.0918