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Should I keep my employer group plan or switch to Medicare?

Jan 17, 2019 11:06:45 AM / by Stephanie Pogue

Stephanie Pogue

You have several options for health insurance coverage when you retire but the three most common options are:

  1. Keep your employer group plan
  2. Keep your Medicare Parts A and B, enroll in a Part D plan and get a Medicare Supplement
  3. Or, enroll in Medicare Part C, commonly called a Medicare Advantage plan

So, how do you know if you should stay with your employer group plan or switch to Medicare? After all, once you leave your group plan, you can’t go back.

Do you have a question-1These are the questions I ask my clients to help determine what’s the best course of action.

  1. Will you have to enroll in Part B?

Most of the time, once you stop working the employer wants you to enroll in Part B as soon as you are eligible for Medicare because then Medicare becomes your primary insurer and your group becomes secondary. This helps keep their cost down, but it will be an additional amount you owe.

Related: Medicare Resource Page

  1. How much will the premium be with your employer after you retire?

Keep in mind the premium for their plan is in addition to the Part B premium ($135.50 in 2019).  If the total amount is higher than what you would pay for an individual plan, there is usually no reason to stay. If the group plan cost is lower, then look at the co-pays and deductibles.

  1. What are your co-pays and deductibles?

Many employer group plans share the cost of care with you by asking you to pay high deductibles before your coverage starts. Most Medicare plans have very low, or non- existent deductibles. That means less up-front costs for you.

  1. What are the out-of-pocket maximums?

On most employer group plans the maximum you could pay out of your pocket in a given year is very high, usually several thousand dollars. Most Medicare out-of-pocket maximums are significantly lower.

Related: Do you have to take Medicare at 65 if you're not retiring until 66?

Don’t be afraid to leave the group. Medicare is a good plan and when paired with a supplement or advantage plan, it’s probably better coverage than you have now. 

Do your homework and compare the premium, co-pays, deductibles and out of pocket amounts. A licensed insurance broker can help you do that.  Make sure you talk to someone who offers many plans in the area so you can have a good comparison.

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Topics: Medicare

Stephanie Pogue

Written by Stephanie Pogue

Stephanie has been primarily helping seniors and retirees with their healthcare decisions since 1995. In addition, she has recruited and trained agents, developed and promoted managers, and ranked in the Top 3% of Sales Managers at Bankers Life & Casualty while she was there. She is now the Director of the St. Louis Insurance Group and can be reached by email at