Ask The Experts: Retirement

By Reg Jones

Medicare Part B

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Q. I am a recent retiree and have to decide whether to obtain Medicare Part B coverage. I have, and intend to keep, my Blue Cross coverage. I am trying to determine whether I should opt for Medicare Part B for my wife and I, even though I have Blue Cross. The Medicare Part B monthly payments would range about $150 for each of us.

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Turning down Medicare Part B but taking it later

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Q. I am 65 years old and am employed full time by the federal government. I will continue my federal employment for several years. I am covered under Federal Employees Health Benefits and pay for Blue Cross/Blue Shield insurance. If I decline Part B now and decide to take it later, will I be subject to the Medicare Premium penalty?

A. Yes, you can decline Part B while you are still employed without penalty. When you are no longer employed, you’ll have an eight-month window in which to enroll, penalty-free, which begins the first full month after you retire.

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Retirees, Medicare and the ‘creditable plan’

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Q. I am retired with Blue Cross/Blue Shield and will be signing up for Medicare Part A soon to avoid penalties for Part B and Part D. Does my BC/BS meet the “creditable plan” requirement to avoid penalties? I have been told “yes and no” on the phone by Medicare. If I sign up for an HMO with a lower cost, will I meet “creditable plan” standards if I drop Federal Employees Health Benefits? Can I re-sign up for BC/BS later if I don’t like the coverage?

A. The “creditable plan” feature you’re referring to only applies to those who are currently employed or are covered by a family member who is employed. It doesn’t apply to retirees, regardless of the plan they are in.

If you drop your FEHB coverage, you can’t re-enroll in it unless you return to work for the government in a position that allows you to be covered by the FEHB program.

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Medicare

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Q. I am an unmarried 64-year-old CSRS annuitant who will turn 65 on July 15. I’ve had Blue Cross/Blue Shield coverage for many years. What should I do about Medicare and when?

A. You can apply online at www.ssa.gov/medicareonly. Do it a few months in advance to avoid delays in being covered.

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FEHB and Tricare for Life

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Q. On Jan. 18, there was question about which is primary between these two programs, and the answer ended with “whether you keep both [Federal Employees Health Benefits] and Tricare is something you’ll have to decide.” How do you decide? Where can I find a clear, side-by-side comparison of my FEHB (BC/BS standard in my case) and Tricare for Life — one that is not comparing apples to oranges? I have been told I don’t really need FEHB because TFL is “very comprehensive,” but how can I find out exactly what, if anything, FEHB would cover that TFL wouldn’t. P.S. I’m in excellent health and am also covered by Medicare Parts A and B.

A. Unfortunately, no one has made such a comparison, nor is it likely that anyone will. While Tricare and Medicare A and B are monolithic, with their benefits spelled out in detail, there are around 200 plans in the FEHB program. And what they cover varies, not only in the services covered but in the level of reimbursement, co-payments and deductibles. If you want to make such a comparison, you can do so by carefully reviewing what your own FEHB plan provides with what Tricare does.

In closing, you mentioned that others have told you that you don’t need the FEHB coverage because Tricare is very comprehensive. While I don’t know if that’s true, I’ve been told the same by other former members of the military who made the decision to suspend their FEHB coverage and were happy with the decision. Whether you’d be happy if you did the same is something I can’t predict.

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Health insurance

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Q. I am enrolled in Medicare Part A and B. I also have Tricare for Life and Federal Employees Health Benefits (Blue Cross/Blue Shield). My doctor has opted out of Medicare and wants $5,000 for a hip replacement. Will FEHB pay his fee?

A. The only way to find out how much of your doctor’s fee your FEHB plan will pay is to ask them.

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Medicare Part B

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Q. I am retired and have Blue Cross/Blue Shield Basic for my health plan. I will be 65 in May and need to make a decision on whether I should get Part B when I have my current FEHB coverage. If I decide to take Part B, there will be another monthly cost. Is there any FEHB plan that would benefit me to enroll in and also keep the costs down if I decided to take Part B? This is confusing to me.

A. It’s confusing to you because it’s confusing to everyone faced with that decision. Unfortunately, there isn’t any way to make it less confusing. You’ll have to consider your current and anticipated health care needs. Then you’ll need to review the pluses and minuses of your current plan and Medicare Part B to see if there’s anything to be gained by enrolling in Part B. Finally, you’ll need to look at some other FEHB plans with lower premium costs to see if they’ll provide you with what you need and want, while offsetting some of the cost of Part B.

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Jan. 1, 1983

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Q. I am reading in a Blue Cross/Blue Shield brochure that you have to be a federal employee as of Jan. 1, 1983, to get free Medicare Part A. I joined in March 1983 and do not have Social Security eligibility. Will I get Part A for free or not? What is the significance of Jan. 1, 1983?

A. Here’s the scoop from the Social Security Administration: “Federal employees are required to contribute to the Medicare Trust Fund and are therefore eligible for Medicare. This provision is referred to as the Medicare Qualified Government Employees (MQGE) provision.

“All wages paid to Federal employees after Dec. 31, 1982, are taxed for health insurance, and through payment of this tax, employees earn Government Employment Quarters of Coverage (GEQCs). GEQCs can be used only for Medicare purposes. These GEQCs are counted toward Medicare coverage only and do not count toward entitlement to Social Security benefits.

“Federal employees need the same number of total QCs to qualify for Medicare as they need to qualify for Social Security insured status.

“However, under a transitional provision in the law, any Federal employee who was an employee at any time during January 1983 and was employed before Jan. 1, 1983, may be granted GEQCs for Federal service prior to January 1983.”

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CSRS and Medicare eligibility

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Q. My father was a federal employee for many years and he retired in 1983. He passed away in 2004 at the age of 80. My mother has been receiving an annuity benefit since that time. The only insurance that my father ever had was his Blue Cross/Blue Shield Federal. Why was he (and now my mother) not eligible for Medicare Part A? Shouldn’t he have been paying into the Medicare system through payroll deductions when he was employed with the Federal Communications Commission?

A. Because he was a CSRS employee who retired before December 31, 1983, he didn’t have payroll deductions  for Medicare Part A taken from his pay. It was only after that date that employees were required to have those deductions taken out.

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Health insurance change

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Q. I am a 69-year-old female FERS retiree, covered under parts A and B of Medicare and Blue Cross/Blue Shield basic for federal employees. I also have my spouse insured on this plan. My spouse is a military retiree, so we have Tricare for Life, and he also has parts A and B of Medicare.

I would like to change to the less expensive BC/BS health insurance, but I want to keep the doctors we currently have. Is there a possibility I would have greater out-of-pocket expense with the standard BC/BS? I would like to take the difference in premiums and subscribe to a dental plan.

A. To find out if you’ll be able to keep the doctors you now have, you’d need to check with Blue Cross/Blue Shield. While there is a possibility that you would have greater out-of-pocket expenses with the lower-cost option, the only way to find out is to check with your plan and learn how that option handles claims from members who are covered by Medicare parts A and B.

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Medicare Part B penalty

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Q. I am retired under CSRS with survivor benefits for my spouse. I have Medicare Part A and Federal Employees Health Benefits Blue Cross/Blue Shield family plan. My spouse has just become Medicare eligible. Since there is a penalty (140 percent) for me to pick up Part B, we are contemplating continuing with the Medicare Part A and FEHB. The adviser at Social Security questioned our health insurance coverage after I die, noting the penalty in picking up Part B later. I assume that FEHB coverage will continue with the survivor benefits. Also, will the cost of the FEHB become the self-only rate?

A. If you are enrolled in the self and family option and have elected a survivor benefit for your wife, she would be able to continue that coverage and could convert to the self-only option.

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Medicare Part B penalty

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Q. I am 68 years old and signed up for Medicare Part A before my 66th birthday. I have not signed up for Part B for several reasons.

1. My husband is 60 years old and we have insurance coverage with Federal Employee Plan Blue Cross/Blue Shield.

2. We are posted out of the country, in the Czech Republic.

3. I have no occasion here to use Medicare or incur its costs.

Health costs are self-paid upfront in full and then partially reimbursed by our insurance company.

I believe individuals are penalized 10 percent per year for not signing up for Medicare when they are 66.

It will have been five years past that stipulation when we return to the U.S. and I am 70. My husband swore an oath of availability for worldwide service when he joined the State Department.

Why will I be penalized up to 50 percent for not acquiring Part B, a service that I don’t need and cannot use?

A. Because you were either enrolled in or covered by a group health plan when you first became eligible to get Medicare Part B, there won’t be any penalty. Under special enrollment period rules, you may enroll during any month that you are covered by a group plan or during the eight-month period that begins the first full month that you are no longer covered under that plan based on current employment. Whether you decide to enroll in Part B or not is up to you. Just check with your plan to find out how your decision will affect your plan benefits.

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Medicare and Blue Cross/Blue Shield

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Q. I’m a federal retiree who is considering changing to Blue Cross/Blue Shield Basic during the next open season. How does Medicare Part A work in conjunction with BC/BS Basic? Which would be the primary?

A. Medicare would be primary and your Federal Employees Health Benefits plan secondary. To find out how the two benefits would be coordinated, check with your plan.

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65 or 66?

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Q. I have been retired under Social Security disability since 2000. I declined Part B because of federal insurance. My Postal Service disability turned over to regular pension at age 62.  I am now 64. According to new law, I am eligible for regular Social Security at age 66. Will my federal Blue Cross/Blue Shield continue until age 66, or does it end at age 65? And do benefits change at all? Do I then have to apply for Part B at 65, or do I wait to apply at 66? And do I have to pay a penalty for all of those years I didn’t apply while on BC/BS? Everywhere says apply for Part B at age 65, but does that apply even though I am eligible for regular Social Security at age 66?

A. Your Federal Employees Health Benefits program coverage will continue as long as you keep paying the premiums. In your case, I assume that you are doing that through deductions from your annuity. Whether you decide to enroll in Medicare Part B is up to you. You’ll first become eligible for Part B when you reach age 65. The law covering Part B is separate from the one that determines your eligibility for a Social Security benefit.

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Social Security and Medicare

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Q. I am retired and on Social Security disability. I am 63 and now receiving regular pension since 62. I am covered by FERS BC/BS. I was under the impression that my coverage continued till age 65 when I retired in 2000. I will have to wait till 66 to retire under the new Social Security rules for retiring. Will the health coverage continue till age 66, or will it stop at 65, leaving me with no insurance since I can’t get Medicare till age 66 now? And how does one keep the coverage later?

A. First, a correction. The eligibility age for Medicare is still 65. Only the age at which someone becomes eligible for a Social Security benefit has changed.

Now on to your basic question. As long as you continue to have premiums deducted from your annuity, you will be able to continue your Federal Employees Health Benefits coverage for the rest of your life.

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Medicare

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Q. My sister is a retired police officer living in North Carolina and will be eligible for Medicare in August. How does she apply for Medicare? All of the questions I’ve looked at address retirees who are on Social Security, which she will not be. She will continue with Blue Cross/Blue Shield government health insurance.

A. She should call the Social Security Administration at 1-800-772-1213 and talk to one of their benefits specialists. If she isn’t eligible for a Social Security benefit, she won’t be eligible for Medicare Part A. However, she can enroll in Part B at her own expense.

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Reduce health coverage?

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Q. I have the standard option federal Blue Cross/Blue Shield. I will be 65 this year and will sign up for Medicare Part B. Should I reduce my federal coverage to the basic option?

A. Only you can answer that question. You’ll need to compare the benefits in each Federal Employees Health Benefits option with what Medicare provides and how the two interact. Since you know both your current level of health and what you anticipate (or fear) may happen in the future, you are in a better position than anyone else to decide which is the better choice.

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Medicare application

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Q. We are getting conflicting answers to a question.

I am retired from Civil Service and have Blue Cross Blue Shield (high option), as well as Medicare Parts A and B.

My husband is under my BCBS policy. He just turned 65 but will continue to work until 66. Can he apply for his Medicare card Parts A and B now? If yes, how and where? Medicare has not sent us paperwork.

A. He can apply online at www.ssa.gov/medicareonly.

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Switching from Blue Cross/Blue Shield to Medicare Part B

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Q. 1. Can someone switch from Blue Cross/Blue Shield to Medicare Part B at age 71?

2. Should it be done?

3. If yes, how can it be done, and what are the costs?

I am 71 and self-employed (since 2011), covered under my wife’s federal Blue Cross/Blue Shield plan. My wife has been retired for a few years and she also turned 71 in 2012.

My wife was just operated for a brain tumor and is being scheduled for radiation therapy and chemotherapy.

A. While your wife could disenroll from the Federal Employees Health Benefits program and both of you enroll in Medicare Part B, what she gained by no longer having to pay premiums for the former would likely be offset by the premiums you’d both have to pay for the latter. Although each of you would have to pay $99 per month in 2013, the fact that neither of you enrolled when you were first eligible would mean that those premiums would be increased by 10 percent for every year you failed to do so.

Further, the benefits you both now receive from Blue Cross/Blue Shield are substantial. While adding Part B would increase that coverage, dropping the FEHB coverage would adversely affect it. Further, if she dropped her FEHB enrollment, she would never be able to re-enroll.

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Medicare Part B

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Q. I am confused about your Oct. 22 answer to “Medicare Part B in retirement.”

I am 63, retired, receiving my Social Security benefit, have coverage with Blue Cross/Blue Shield for my wife and myself, am not employed, and have no plans to return to work. It is my understanding that BC/BS requires purchase of Part B when I become eligible in a year or so. Yet, the answer to the question seemed unequivocal in stating that B is optional. Can you clarify for me, please?

A. Don’t be confused. What I wrote is correct. To back that up, here’s what the Office of Personnel Management has to say on the subject: “You don’t have to take Part B coverage if you don’t want it, and your Federal Employees Health Benefits plan can’t require you to take it.”

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