Should I Wait to Sign Up for Medicare at Age 65?

Four Reasons Why You Might Want to Wait To Sign Up For Medicare

A funny thing happened as I set out to write this post.

We’ve done some posts recently about issues of concern to people turning 65. Some readers wonder whether they really need to sign up for Medicare during their Initial Enrollment Period … you know, the one that gets underway three months before the month in which you turn 65 and ends three months after the month of your 65th birthday. I remember writing recently that Medicare enrollment is entirely voluntary whether you’re 65 or 95. Yet I pointed out that for most people aged 65 it was advisable to enroll in Medicare during initial enrollment.

As I said then, enrolling in Medicare when you’re first eligible means you won’t be stuck with late enrollment penalties if you enroll in Medicare later. True, people who work past 65 generally qualify for Special Enrollment Periods (SEPs) when they stop working, and can avoid many of the late penalties generally associated with enrolling in Medicare after initial enrollment—but many people learn the hard way about those Medicare late-enrollment penalties.

I mentioned a few excuses people make for not enrolling in Medicare at 65. These excuses often involve expressing satisfaction with employer or Veterans Affairs health coverage. But, as I wrote recently, Medicare is generally compatible with private health plans as well as the VA Medical Benefits Package. Although someone with good alternative coverage may reasonably decide to opt out of Medicare Part B (and its monthly premium of over $100 a month), I suggested there weren’t many good reasons not to be enrolled in Medicare Part A, which for the vast majority of Americans is premium-free.

In the interest of fairness and balance, I thought it would be a good idea to write another post identifying a few instances in which it might be advisable for a 65-year-old not to enroll in Medicare. We’ll get to that funny thing that happened in a moment, but first here are the best reasons I could come up with for not enrolling in Medicare during initial enrollment.

1. I have COBRA coverage.

I brought this reason up in an earlier post, and, yes, it does deserve some consideration.

If you have COBRA coverage, you need to know that your COBRA coverage normally will end if you enroll in Medicare. This puts you in an either-or situation, and you need to compare the benefits of keeping your COBRA coverage while it remains available to the benefits of switching to Medicare. But even if you lose COBRA coverage because you’ve enrolled in Medicare, your spouse and dependent children should be eligible to keep their COBRA coverage for up to three years.

As far as you are concerned, your COBRA coverage is likely to last 18 months at most. Even if you’re happy with your COBRA coverage, you ought to look at the long-term implications if you’re thinking about staying with COBRA for now and enrolling in Medicare sometime after your initial enrollment opportunity. Remember, with COBRA coverage you’re far less likely to qualify for an SEP later because you’ve already finished working.

If you receive COBRA coverage after enrolling in Medicare, you’re able to keep both your Medicare and COBRA coverage. That’s a strong sign that you shouldn’t delay enrolling in Medicare if you’re expecting COBRA coverage in the future. And, remember, it’s Medicare and not COBRA that you can expect to stay in your corner for life.

2. I have a Health Savings Account (HSA).

You have an HSA, and you’ve been contributing to your account for years.

Now you’re thinking about enrolling in Medicare … only to learn that you can’t add any further contributions to your account if you’re enrolled in Medicare.

While enrolled in Medicare, you can’t put any more money into your account, but you can take money out. You can draw on funds in your HSA to help pay out-of-pocket Medicare costs. You even can use your Health Savings Account to pay Medicare Part B, Part C, or Part D premiums. What’s more, withdrawals from HSAs are often tax-free.

People with HSAs, however, usually prefer to build up their accounts rather than deplete them. As a result, despite the high deductibles often associated with Health Savings Accounts, some people decide to opt out of Medicare in order to continue contributing to their HSAs. But did you know you can jeopardize your Social Security payments if you decide to opt out of Medicare Part A? That may change in coming years, but for now—I’ll say it again—there’s at least a possibility you’ll be jeopardizing your Social Security payments if you decide to opt out of Medicare—and specifically out of Medicare Part A. Even if you have a Health Savings Account that’s been serving your needs fairly well, think long and hard before deciding to continue contributing to your HSA at the cost of not enrolling in Medicare. Look at the long-term consequences of not enrolling in Medicare during your initial enrollment opportunity. Factor in potential late enrollment penalties along with deductibles your HSA requires you to pay. Also consider potential long-term savings if you enroll in a comprehensive Medicare supplement or Medicare Advantage plan. Put every relevant detail into the mix … coverage … coverage limits … up-front costs … hidden costs … possible Social Security considerations … and then make the most responsible decision you can for your future and the future of your family. Call MedicareMall toll-free at (877) 413-1556 if you need help.

3. Uh … uh … I have … uh, I want … uh, Medicare is too …

Let me start again.

I … uh … it’s all about … no, I mean … uh …

You’ve probably figured out that funny thing that happened. There’s not another reason I’ve come across—at least, not a good one—suggesting you shouldn’t enroll in Medicare at age 65.

How about this one?

4. I don’t ever plan to get sick.

Well, neither do most of the people who do have medical issues … and who are grateful they had the foresight to sign up for Medicare at their earliest opportunity. They signed up, checked out Medicare supplement insurance and prescription drug plans, and now they’re in a position to worry less and enjoy life more.

The conclusion here: For the vast majority of Americans reaching Medicare age—whether they’re still working or not—there aren’t many good reasons not to enroll in Medicare at age 65.

Medicare can go a long way toward helping you maintain your good health. If you have questions about senior healthcare including Original Medicare (Medicare Part A and Part B), Medicare supplement plans, or Medicare Advantage, contact MedicareMall now and let us save you money and lead you with confidence through the Medicare maze!

I couldn’t think of many good reasons you shouldn’t sign up for Medicare at 65. Can you? Leave a comment below!


Should I Wait to Sign Up for Medicare at Age 65?© 2013

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