Navigating through Medicare is like a game of Whac-A-Mole. Every time you eliminate one problem, another pops up.
The latest twist? The initial premium payment.
Medicare Premium Times Three
If you are someone who signed up for Medicare but are not yet collecting social security, you can expect a bill for your Medicare premium. For most of us, Medicare A (hospital coverage) comes at no cost. Part B (medical coverage) has a monthly premium that may change annually.
Those enrolling for the first time in 2016 will have a Medicare premium of $121.80 for Part B. As all things Medicare, there are exceptions. For example, you pay more if you make more than $85,000 a year.
If you collect social security, you are able to have the Medicare premium deducted from your monthly social security payment. However, this scenario is for first-time Medicare beneficiaries (typically turning age 65) who do not collect social security.
So, what’s the surprise?
When your receive your first Notice of Medicare Premium Payment Due, the bill is for three months – not the one month premium most expect.
Who does that?
- An insurance company bills you monthly
- You don’t pay for two months in advance
- Who does that? Medicare does that.
You do have an option to have payments automatically deducted monthly. However, the process is an archaic paper form that is snail mailed in. And, depending who you speak with, can take anywhere from 6 weeks to three months to set up.
You can also see about setting up automatic payments with your bank. But to do that you’ll need you Medicare number (on the red, white, and blue Medicare card) and the address for payment.
Confusion and Consequences
Nothing received through the Medicare enrollment process explained the billing of three months. After much online research, I finally found the first mention of it on My Medicare Matters, a site set up by the National Council on Aging.
A call to Social Security (that processes the Medicare premium payments) offered no help to get switched to monthly payments. You cannot send in a one-month payment at the start of each of the next three months (according to the “let me put you on hold” representative).
Although the My Medicare Matters site does say there is a three-month grace period for paying the premium. For example, if a bill is due October 25, the grace period ends on January 31.
Medicare terminates coverage at the end of the three-month grace period.
- You are unable to enroll again until the General enrollment period (January – March each year)
- After reapplying, coverage is not effective until July 1
- The new payment will most likely be higher due to the coverage interruption
- AND you still owe the original bill amount
So, do you assume the Social Security representative was wrong? Do you risk sending a payment monthly, as long as you pay the entire amount before the end of the grace period?
Social Security’s only suggestion was to call Medicare as that entity would need to approve paying the premiums monthly.
A call to Medicare only offered the time-delayed paperwork for automatic deduction and the statement that only one entity could change the initial premium notice to monthly. You guessed it. The referral was back to Social Security – even though you explained to the Medicare representative that Social Security sent you to Medicare.
Where does that leave the average Medicare newbie? Stuck between a rock and a hard place.
Moral of the Story?
I hope you can avoid similar problems. The following are a few suggestions.
- Start early. I did, but due to family health issues, I figured I’d process the automatic payment portion after I paid the initial one-month payment. So much for best laid plans.
- Get help from a qualified Medicare broker/professional. Again, I did (even though I am a licensed agent, I did not sell or service Medicare accounts). He never contacted me after the initial, “Thanks for the referral,” I received from my individual broker.
He may be the ONLY Medicare representative in the country who did not contact me.
I long for the day when I no longer receive unwelcome Medicare surprises. One can dream.
May the Force be with you.
Notice of Disclaimer –Cathy Miller is not an attorney or health care provider and cannot provide legal or health care advice. The information provided is for your general background only, and is not intended to constitute legal or health care advice as to your specific circumstances. We recommend you review legislation with legal counsel and visit your physician for health care issues.