Retirees must decide what type of health insurance is right for them. A number of factors influence their decisions, including when they retire and how long they expect to be without coverage. Other important considerations include their medical needs, financial status and options available to them. In general, early retirees need to find a plan that provides a sufficient amount of coverage for the majority of their health care expenses. There are many options for this purpose, including an employer-based health benefit, a private marketplace plan, Medicaid, COBRA or short-term insurance.
Medicare is the primary payer for many of a senior’s healthcare expenses. The other major payer is a private insurance plan. This type of coverage often acts as a secondary payer, paying for the services that Medicare doesn’t cover. In some cases, this type of coverage also pays for services that aren’t medically necessary or may be covered by other types of health insurance.
A number of large employers offer health insurance as a retirement benefit to their employees. This benefit is often more affordable than a private marketplace plan. In fact, many retirees who have access to an employer-sponsored plan may choose not to apply for a marketplace plan in order to maintain their employer’s health insurance.
In recent years, however, some companies have chosen to reduce their retiree health benefits in response to the Federal Accounting Standards Board’s “Retirement Income Fairness Act.” It is possible that more of these changes will take place in the future.
As the cost of Comparing health insurance for retirees aged 65 and above rises, it becomes more difficult for many people to afford private healthcare coverage. For this reason, some choose to wait until they reach the age of 65 to sign up for Medicare. However, there are consequences to doing this. Seniors who wait to enroll in Medicare will pay a penalty for each month they delay signing up for the program. This penalty increases with each year that seniors wait to sign up for Part B of Medicare.
The best way to determine the best time for a senior to sign up for Medicare is to talk with a representative at their local Social Security office. They can explain how the initial enrollment period works and what the penalty will be for delaying the program.
MIT offers two supplemental health plans, Medex and Tufts Medicare Preferred, to help cover the costs of certain healthcare services that are not covered by Medicare. These plans are designed to bridge the gap between what Medicare covers (80% of the cost after the Part B deductible is paid) and what a person is responsible for paying (20% of the cost). To learn more about these supplemental plans, review the Member Health Care Guide.
