Questions about Medicare and HSAs

[Limozine]

I have a T65 who is married to an employee of a large (20+ employees) company. He (the T65) is turning 65 in October. I have two questions:

1. Can a large company require family members to go on Medicare A&B when turning 65 in order to retain company coverage? I've always said the answer is no, but I recently ran into an individual who said their (large) company was requiring them to take A&B.
2. The couple files taxes jointly. Can she (the employee) continue to contribute to an HSA without affecting him, since he will probably be taking Part A in October?

 

[annon123]

I have a T65 who is married to an employee of a large (20+ employees) company. He (the T65) is turning 65 in October. I have two questions:

1. Can a large company require family members to go on Medicare A&B when turning 65 in order to retain company coverage? I've always said the answer is no, but I recently ran into an individual who said their (large) company was requiring them to take A&B.
2. The couple files taxes jointly. Can she (the employee) continue to contribute to an HSA without affecting him, since he will probably be taking Part A in October?

I think it likely varies by company and possibly by state? I have worked two places where the HR health benefits require t65 to pay for B. I have worked other places where that isn't an issue. I never read in further detail as it wasn't relevant to me at the time.

 

[LostDollar]

Caveat, not an agent or tax preparer

1. Are they then going to say that Medicare must pay primary to the health plan?

2. If the wife continues to be covered by a high deductible health plan, it is my belief she can continue to make an INDIVIDUAL contribution to her own HSA. You should advise them to consult with their tax preparer or tax software company as appropriate. (I'd hunt for something, but you can google that as well as I can.) Personally, I would also ask wife to reverify with HR that the individual coverage chosen continues to be an HDHP.

 

[LostDollar]

Caveat, not an agent.

Speculation only here.

You may be walking into a situation where the employer's health insurance carrier has a contract written to say Medicare is primary, and the carrier plans on processing employee's claims as though Medicare is primary.

If you choose to involve yourself, you may be setting yourself up for a tremendous amount of unpaid support time and emotional stress.

 

[LostDollar]

I think it likely varies by company and possibly by state? I have worked two places where the HR health benefits require t65 to pay for B. I have worked other places where that isn't an issue. I never read in further detail as it wasn't relevant to me at the time.

Caveat, NOT an agent.

IMO, It's the insurance carrier, not the company, that controls here.

 

[annon123]

Caveat, not an agent.

Speculation only here.

You may be walking into a situation where the employer's health insurance carrier has a contract written to say Medicare is primary, and the carrier plans on processing employee's claims as though Medicare is primary.

If you choose to involve yourself, you may be setting yourself up for a tremendous amount of unpaid support time and emotional stress.

I'd guess the company also thinks about if you kick the older people off the plan as primary, likely that will help to keep premiums down since the older you get the more likely you are to use health care. Companies negotiate the coverage with the insurance company.

 

[LostDollar]

I'd guess the company also thinks about if you kick the older people off the plan as primary, likely that will help to keep premiums down since the older you get the more likely you are to use health care. Companies negotiate the coverage with the insurance company.

I don't think that is legal.

 

[annon123]

I don't think that is legal.

Some employers I worked for require those old enough for medicare to have that as their primary. I am reasonably sure it is legal to do that as many companies do that. Their private reasons (eg keep costs down) may be questionable but if it was illegal to do this then it wouldn't be as widespread as it is.

 

[LostDollar]

Some employers I worked for require those old enough for medicare to have that as their primary. I am reasonably sure it is legal to do that as many companies do that. Their private reasons (eg keep costs down) may be questionable but if it was illegal to do this then it wouldn't be as widespread as it is.

Caveat, not an agent.

Have you reviewed CMS' Coordination of Benefits rules for Medicare and Over 65 employees covered under group health plans provided to those employees with current active employment?

In my opinion, those provide some starting point general guidelines about legal and illegal activity by employers and their insurance carriers in relation to Medicare and Employer Health Coverage.

(Note, there has been no response to my question 1 in post 3 above.)

 

[annon123]

Caveat, not an agent.

Have you reviewed CMS' Coordination of Benefits rules for Medicare and Over 65 employees covered under group health plans provided to those employees with current active employment?

In my opinion, those provide some starting point general guidelines about legal and illegal activity by employers and their insurance carriers in relation to Medicare and Employer Health Coverage.

(Note, there has been no response to my question 1 in post 3 above.)

A number of companies require those turning 65 to sign up for medicare and their insurance with the company changes at that age. Regardless of what you think it is legal to do that. Yes there are likely guidelines they have to follow, but that does not change it is legal to require that.

Note - I am not required to answer all your questions. I'd suggest talk to your HR office if you have questions about this and how it works. There are many variations about what companies do when employees turn 65, are fully retired...