Here are some of the most common Medicare mistakes seniors make. Please take a moment to understand the detrimental impact just one little mistake can have.
- Believing Medicare covers long-term care.
Medicare does not cover long-term care expenses, so purchase long-term care insurance early on while affordable.
- Not purchasing coverage beyond Parts A and B.
Don’t just enroll in Medicare Part A and Part because you’re healthy and don’t think you will use it. Sign up for other Medicare coverage — like a Medicare supplement or Medicare Advantage plan.
- Believing zero-premium plans mean zero cost.
A zero-premium Medicare Advantage plan does not mean zero cost. Generally, you will still have to pay things like co-pays up to your maximum out of pocket.
- Failing to review coverage annually.
You should review your Medicare plans during the annual Open Enrollment Period. Medicare Advantage and prescription drug plans change every year. Medicare supplement premiums rise over time as well.
- Enrolling when you are eligible to delay.
You do not need to enroll in Medicare at age 65 to avoid enrollment penalties if you have creditable health coverage like most employer group coverage.
- Delaying enrollment when you should enroll.
You should enroll in Medicare at age 65 even though still working and covered by an employer’s health care plan like when working for an employer with fewer than 20 employees and is not creditable coverage.
- Skipping enrollment if you’re healthy.
Don’t skip your Initial Enrollment Period because you still consider yourself active and healthy. You are not invincible and will lead to several penalties and restrictions later.
- Not understanding primary payer rules.
Understand primary payer rules. An example is a COBRA plan that is not the same coverage as your employer group plan. A COBRA plan is not considered a primary payer, leaving you to pay your medical bills plus you’ll pay a late enrollment penalty for life.
- Continuing HSA contributions while enrolled.
If you keep contributing to your Health Savings Account (HSA) when you remove the money from your account, it will be subject to an excise tax and must repay the match HSA contribution made by your employer during that time.
- Not understanding impacts of IRMAA.
Any changes to your income can affect Social Security’s calculation of your Income Related Monthly Adjustment Amounts. For example, if you converted a large IRA to a Roth IRA, sold a property, or get an inheritance, you may have to pay more for your Medicare Part B and/or Part D.
Don’t take any chances with your Medicare or Medicare insurance, call a licensed Ashford Insurance agent today at 817-952-3153.
Note: We are not financial advisors and encourage you to seek professional financial advice.
Photo by Marcus Aurelius.
