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Age 65, Still Working; Medicare, Tricare for Life, Your Employer's Health Plan

Age 65, Still Working; Medicare, Tricare for Life, Your Employer's Health Plan

What do you do? You will continue to work after age 65. You are covered by your employer’s health plan. However, you’re faced with the Medicare/Tricare for Life (TFL) decision. Here are your options.

  1. Stay with your employer plan and delay Medicare/TFL enrollment. You are allowed to delay Medicare Parts A/B enrollment as long as you are working and covered by an employer’s health plan. There is no Medicare penalty as long as you apply for Parts A/B before you stop working or you enroll in Parts A/B within 8 months of the end of work or the end of the health plan, whichever is first. With this option, you temporarily lose TFL benefits until you enroll in Parts A/B. You can still be enrolled in Part A while you work and not pay a Medicare premium. If your spouse is younger, your spouse will continue under the employer’s health plan or stay under Tricare Standard/Prime or both until age 65.
  2. Go with both the employer plan and Medicare/TFL. Enroll in Parts A/B Medicare, get your TFL benefits and have your employer’s plan. Of course, you’ll pay for all programs and you will probably be over insured, but some folks like the feeling of extra coverage. Again, younger spouses will stay under Tricare Standard/Prime until age 65.
  3. Go Medicare/TFL only. Check to see if you can suspend your employer’s plan before you outright cancel it. If you can suspend the employer’s coverage, you leave yourself an option to return to the coverage should you want to at some point in the future. Enroll in Medicare Parts A/B three months prior to age 65. You actually have until the third month after age 65 to sign up but your coverage will be delayed by a month or two. Again, younger spouses wait until age 65 to be covered by TFL and will stay under Tricare Standard/Prime until then.

As long as you are working and covered by your employer’s plan, the employer’s plan is the first payer, Medicare second, and Tricare third. Check to ensure the coordination between your employer plan and Medicare functions. You’ll have to file manual claims with Tricare under this arrangement—if it is ever necessary.

Once you stop working and if your employer plan is continued into retirement, Medicare will pay first, then your employer’s plan and finally Tricare. You’ll have to file manual claims with Tricare when they are the third payer.

If you are TFL only, Medicare is the first payer and Tricare acts as a Medicare supplement. Claims are filed by the health care providers to Medicare and Medicare automatically forwards the residual bill to Tricare. The Tricare portion of TFL is invisible to the health care providers under TFL so just ensure your providers accept Medicare and you are golden. Any Medicare provider works for TFL. Just show your Medicare card for treatment since there is no need to show a military ID card for the TFL coverage.

Most people prefer to use the Tricare drug coverage. If this is you, do not enroll in any another drug plan. Enrollment in another plan causes it to pay first and you’ll be filing manual claims with Tricare. Plus, enrollment in another drug plan disqualifies you from enrollment in the Tricare Mail Order Pharmacy (TMOP). Always use the TMOP when possible to get the greatest benefit and to reduce costs on the DOD.

See this Medicare and You handbook for easy to understand information or go to www.medicare.gov/medicare-and-you/medicare-and-you.html.