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When Group Coverage Ends

The current economy has led many to consider retirement a little sooner than they had planned. If you are already over age 65, your retirement is going to include some complicated health insurance options.



When you turned age 65, you were enrolled in Medicare Part A. You might have also been enrolled in Medicare Part B. That depends on what type of plan you already had from your employer. Your first step is to verify your Medicare enrollment.

Next, who else is enrolled in your employer plan? Is your spouse also enrolled? Are they under 65 or over 65? Your employer will be offering COBRA coverage, probably at a substantial cost. But you will need to compare that to what is available through Covered Ca or directly from the insurers.

If you or your spouse do not already have Medicare Part B, that will be your next step. The easiest way to get it is to enroll online at SSA.GOV. You will need to have documentation from your employer showing that you had group health coverage that meets creditable coverage standards, from the date you turned 65 until the date your current benefits end. This is called a Certificate of Creditable Coverage and is often combined with a second required notice called the Notice of End of Coverage. Otherwise, Medicare will assess a late enrollment penalty and, force you to wait until the next Medicare General Enrollment Period.

That same documentation will be required when you enroll in a new Medicare Part D plan for your prescription drug coverage and a Medicare Supplement or a Medicare Advantage plan. The certificate must show uninterrupted coverage from the time you turned 65. It is important that you request these documents as soon as you know you are retiring. Many employers and benefit administrators wait until after your coverage ends to send this to you. That can lead to a gap in coverage and you definitely want to avoid that.

Once you have verified your Part A and Part B with Medicare, you can review your plan options and coordinate the start date of coverage to begin the minute your group coverage ends.

For those under 65, or spouse under 65, those same documents again are necessary to get enrolled in an individual health plan, whether it is through Covered CA or directly through the insurer. It is not as important to show the uninterrupted coverage, since health insurance for those under 65 does not have late enrollment penalties, but it is vital to prove that your current coverage is ending. That gives you the right to enroll in an individual plan to begin the day following your group coverage ending.

Retiring is supposed to be a time to relax! Request the Certificate of Creditable Coverage and the Notice of End of Coverage early, so you can avoid any late enrollment penalties or lapse in health insurance coverage.

This is provided for informational purposes only and is not intended to substitute for professional advice. Randy Foulds of Foulds & Feldmann Insurance Agency is an independent broker and Medicare specialist in La Quinta. license #0G69218. You can reach him at 760-346-6565.

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