The Evolving Workforce: Businesses as Medicare Resources for Employees
Susan Diamond | August 22, 2024
The U.S. workforce is witnessing a growing number of older workers aged 65 and above opting to stay in the workforce. This trend, coupled with the Social Security full benefits age now at 67, reflects a change in retirement norms.
Traditionally, hitting 65 meant the end of a career, marked by retirement parties and gold watches. Yet, a shift is underway as more individuals at this juncture opt to prolong their professional careers..
Turning 65 in 2024 marks a significant milestone as America enters the “Peak 65 Zone,” a period from 2024 to 2027 when a historic number of Americans will reach this age. A recent report from the Alliance for Lifetime Income sheds light on this era, revealing that an average of 11,200 Americans per day are projected to turn 65 this year, surpassing the previous decade’s daily average of 10,000.
According to U.S. Bureau of Labor Statistics projections, the workforce participation rate for individuals aged 65 to 75 is expected to exceed 30.2% by 2026, a notable increase from 17.5% in 1996. Additionally, research from Empower indicates that a significant 64% of Baby Boomers and Gen Xers are open to the idea of working indefinitely.
As more individuals work beyond the age of 65, businesses are becoming increasingly aware of the significance of supporting their employees during the transition to Medicare. Recognizing the substantial costs of group coverage, businesses now have a vested interest in becoming a valuable resource, ensuring their employees experience a seamless and effortless switch to Medicare.
This commitment highlights the importance of businesses embracing this responsibility and prioritizing the well-being of their workforce.
If any of your employees or retirees are approaching their 65th birthday, here are five ways you can be a resource:
1. Awareness about the Initial Enrollment Period (IEP):
The Initial Enrollment Period (IEP) is a critical window for most individuals to enroll in Medicare. It begins three months before they turn 65 and spans seven months, concluding three months after the month of their 65th birthday.
Consider this example: if your employee’s birthday falls on June 15, their IEP would start on March 1 and conclude on September 31.
Given that businesses typically keep records of employee birth dates, this presents a convenient opportunity to proactively provide Medicare information ahead of their IEP. Take advantage of this chance to engage and assist employees in navigating their Medicare options effectively.
2. Advise on how to avoid late enrollment penalties:
Understanding the Penalty for Part A:
While Medicare Part A is accessible to the majority at no cost, there are instances where individuals may need to purchase it.
If employees need to purchase Medicare Part A but fail to sign up during their IEP, a 10% increase on their monthly premium is levied for double the number of years they could have but didn’t register.
Implication of Part B Penalty:
Neglecting to enroll for Medicare Part B could result in a 10% rise in premium for every year they were eligible but didn’t enroll. This premium increase is applicable for their entire lifetime.
Consequences of Part D Penalty:
Neglecting to enroll in Medicare Part D, the Prescription Drug coverage, results in a penalty fee that depends on the length of time employees were eligible but neither enrolled nor had creditable coverage. Employees will pay this fee monthly for as long as they’re registered in Medicare.
3. Offer resources for those who choose to delay their Medicare:
If employees prefer to postpone their Medicare enrollment, they must take steps to delay enrollment without incurring late fees. Additionally, they must maintain valid prescription drug coverage.
To determine eligibility for deferred enrollment, it’s recommended to consult with a Medicare specialist.
4. Clarify any questions about how signing up for Social Security may impact Medicare benefits:
The full retirement age is currently 66 years and 10 months, but for individuals born after 1960, it increases to 67 years.
Although employees have the option to enroll in Medicare at the age of 65, there is no requirement for them to start receiving Social Security payments. It’s important to consider that choosing to receive Social Security benefits before the designated retirement age will result in a permanent reduction in benefits for each six months leading up to the full retirement age.
Employees may consider delaying their Social Security enrollment based on their financial circumstances. Each month of delay between full retirement age and age 70 results in a two-thirds percentage increase, totaling eight percentage points per year. It’s important to note that these credits stop accumulating after age 70.
5. Remember to consider spousal coverage as well:
Unlike employer-based coverage, Medicare plans do not provide coverage for dependents. It is important for couples with one partner under employer group coverage to not assume that the other partner will be automatically insured through Medicare. When selecting Medicare plans, it is crucial to consider the health needs of each individual.
Partner with Medicare Experts:
Empower your employees with the knowledge they need for their Medicare journey by teaming up with Health Options NY Medicare experts. Whether they have questions about deferred enrollment eligibility, partner coverage, or anything in between, we can provide the information they need.
By connecting with us online or giving us a call, your company can become a reliable Medicare resource for your employees.
Say goodbye to confusion and let us do the heavy lifting for you. Visit our website or contact [email protected] to learn more about how we can help.
At HealthOptionsNY, our main priority is to provide insight into Medicare for individuals, nonprofits, and small businesses in New York, all at no extra charge. We firmly believe that knowledge serves as the foundation for making informed decisions.
OUR SERVICES INCLUDE:
EDUCATIONAL GUIDANCE & CONSULTATION
We simplify the complexities of Medicare’s various segments (Parts A, B, C, D, and Medigap) and help differentiate between Original Medicare and Medicare Advantage plans clearly. Ask us about our free workshop Medicare Mondays.
TAILOR-MADE ADVICE
Depending on your unique situation, we’ll guide you on whether it’s best to postpone Medicare enrollment or start with it as soon as you’re eligible.
SEAMLESS MEDICARE TRANSITION
When it’s time to make the switch to Medicare, we ensure a smooth transition, providing detailed insights into the insurance landscape. We can also assist with signing up for Medicare Parts A & B.
CONTINUOUS ASSISTANCE
Our commitment to your Medicare needs is ongoing, ready to adapt our support as your situation or the available plans evolve.
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Our professional advice comes at no cost to you. Should you choose a supplemental plan through us, the insurance provider compensates our agency directly.
EMPLOYER OPPORTUNITY
- Assist employees in making decisions tailored to their individual needs.
- Achieve cost savings by transitioning employees to Medicare.
- Minimize the administrative workload for the Human Resources team.
EMPLOYEE OPPORTUNITY
- Employees aged 65 and over are empowered with the choice of their own healthcare plans.
- Medicare presents a range of comprehensive and cost-effective plan options tailored to individual needs.
- Expert licensed agents offer personalized guidance in selecting the most suitable Medicare plan.
Connect with US today and unlock the benefits of our trusted partnership. For questions and support, please contact: Susan Diamond | Independent Broker: 845-594-4818 | [email protected] | www.healthoptionsny.com
Collaborating with HealthOptionsNY offers a holistic approach to supporting your clients and/or employees’ Medicare needs, ensuring comprehensive and personalized care and peace of mind.
