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Medicare rules confuse human resources manager

Dear Toni: I am a human resources manager and have a question about an employee who is turning 65. His situation is a little different because next month he will begin receiving chemotherapy for cancer.

I’m not sure how to advise him because technically he is working full time. He has five months of pay from unused vacation time that he can use while recuperating, which will keep his status as a full-time employee.

Our firm has over 100 employees, and I have been told there are rules based on company size. How can I make sure that I have the correct answer to my questions on behalf of the company’s employees? — Katie, Tampa, Fla.

Dear Katie: Your employee is approaching his Medicare initial enrollment period, which begins three months before his 65th birthday month and ends three months after his 65th birthday month. Many Americans do not enroll in Medicare when turning 65 because they (or their spouse) are still working for an employer with over 20 employees and have employer group health insurance. This rule can protect your still-working-full-time employee with health issues.

Now let us talk about who will pay your claim first. This depends on how many employees are on your company’s group health plan.

■ If you are 65 or older and there are 20 or more employees, the group health insurance pays first. (Please verify there are 20 or more employees enrolled in the employer group health plan.) It may be to your advantage to delay enrolling in Medicare without receiving a Part B penalty.

■ If there are fewer than 20 employees, generally Medicare pays first. The HR department should verify with the insurance carrier as to how the current health insurance plan coordinates with Medicare to determine whether you should enroll in Parts A and B or should delay enrollment in one or both.

Katie, below are a few items that can make your HR job easier:

■ Verify your employees’ options by calling your company’s health insurance plan to discover how the plan coordinates with Medicare.

■ Understand that it may be to an employee’s advantage to delay Part B enrollment. See the “Medicare & You” handbook under “I have other health coverage. Should I Get Part B?”

■ Let employees who are past age 65 know they should contact their local Social Security office immediately to enroll in Medicare if their work status changes from full time to part time, laid off or retired. They will need to file the Social Security forms to avoid the Medicare Part B penalty. They will be eligible for a special enrollment period and should enroll in retiree benefits such as a Medicare supplement or Medicare Advantage plan.

It is important to remember that COBRA and retiree insurance are not considered current employer insurance, so do not delay in enrolling in Medicare Parts B and D.

There are specific Medicare rules regarding leaving employer benefits after turning 65. Learning when and how to change Medicare plans and which Medicare Part D prescription drug plan best fits one’s health situation is vital.

Toni King is an author and columnist on Medicare and health insurance issues. If you have a Medicare question, email info@tonisays.com or call 832-519-8664.

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