(in Massachusetts, Medicaid is MassHealth)
I'm turning 65.
Do I stay on the Employer Plan?
Do I move to Medicare?
It's an individual choice ... Everyone is different and it depends on the particulars of their circumstances ... Here's a case study of an employee and spouse, who both reached Age 65 in January 2016 ...
Small employer ... 25-30 employees
Employee + Spouse premium = $975/month
50/50 split on the premium ... Employee pays $487.50/month
$2,000 individual deductible ... $4,000 family deductible
They could remain on the employer plan if they chose to do so .. If they stayed on the plan, they would sign up for the Medicare Part A Hospital Coverage immediately (it's free) and defer signing up for the Part B Medical Coverage until retirement at which time they
would then sign up for Part B ... Since they have a creditable employer health plan, they will not incur penalties for Part B or Part D when they sign up later
Should they stay on the employer plan or not?
Here was their thought process ... Both are in
relatively good health ... They see their Primary Care Physicians twice a year for wellness visits ... Both take a generic blood pressure medication ... A 90 day prescription at Walmart costs $10 which is less than their copays on their employer plan ... They then compared their employer health plan benefits and costs to a Medicare plan with a $0 premium (they will also need Medicare Part B).
Employer health insurance cost = $487.50/month
If hospitalized, the annual $2,000 deductible applies
Same day surgery = Deductible applies
Emergency Room = $150 per visit
Medicare insurance plan cost = $0/month
If hospitalized, the deductible is
$335/day for days 1 to 5
Same day surgery = $300 per surgery
Emergency Room = $75 per visit
In order to take the Medicare plan, they
would both have to apply for Medicare Part B ...
Part B premium cost = $121.80 x 2 = $243.60/month
Employer health insurance cost = $487.50/month
Their savings = $487.50 minus $243.60 = $243.90
$243.90 x 12 = $2,926.80 per year
There were some differences in
prescription coverage ... The Medicare plan has a $360 deductible which they wouldn't reach (based on their present prescription usage) ... Even if they both had to pay the deductible, they still save $2,206.80 ($2,926.80 minus $720.00) ... They opted for the Medicare plan ... Their reasoning was they'd rather have the $2,200 in their pocket for "when and if" rather than give it to the insurance company for medical expenses that might never
occur.
