Medicare While Still Working

[meleana]

I am 62 and not working, Husband is 64 and will turn 65 in April and will work to at least 66, or that is the plan anyway.



He contributes the max to his HSA since his employer's plan is a high deductible one. I am also covered under that plan. His employer also puts some money into that account as well. Not sure how much- something like maybe $600 or more for the two of us. But you have to jump through hoops each year for that by participating in all kinds of wellness activities in line and so forth.



So my question is: Should he enroll in Medicare Part A in 2019, and should he enroll also in Part B? If he enrolls he cannot contribute to his HSA any longer.



If he does not enroll, he would still have to stop contributing to that HSA 7 months before he retires at age 66 (let's say if he does retire then) the following April anyway at which time he would have to enroll in A and B (and possibly SS- not sure if he would claim it then) immediately.



So my thinking is- why bother contributing to the HSA for just a couple of months in 2019 (Jan, Feb March) if he enrolls in Part A; and if he does not enroll, why bother contributing as he will still have to stop it by October of 2019. Just seems like a big hassle.


2019 would be the first full year of loss of my income since I just stopped working last month. So we could use a little more income out of his check, but we are also ok financially with him making the contributions to the HSA and I know there are some tax benefits but not sure how important at this stage of the game that is for the one year until he retires- IF he does..


Also- being he has a high deductible plan, and he works for a large employer, his work insurance would be primary and Medicare (though it also has a deductible) could cover what his work insurance does not.


Have a headache over the whole thing. Maybe I am overthinking this.

 

[MBSC]

So my question is: Should he enroll in Medicare Part A in 2019...

Kudos on knowing Part A can be retroactive 6 months in certain situations!

Just have the employer make the HSA payroll deductions and don't participate in the wellness incentives if they're too much trouble.

If getting the employer to stop HSA payroll deductions 7 months prior to retirement is too much trouble, then do not set up HSA payroll deductions. Instead, make a one-time contribution in late 2019 via bank ACH equal to the amount he was allowed to contribute for the year. He would lose the FICA tax savings with that method, however, but still claim the HSA contribution on the tax return.

IMHO, I would rather make the HSA contribution than have Part A secondary to the large group plan.

...and should he enroll also in Part B?

He should not enroll in Part B while still on the large group plan. Part B pays very little as secondary payor. He will be paying Part B premiums and receiving less in return. Also, if he should enroll in Part B the clock will start on picking any Medigap without underwriting during the 6 month Medigap OEP. He should save Part B and the Medigap OEP until he retires.

There is a separate Medigap Guaranteed Issue (GI) period but that only applies to small group and retiree plans where Medicare is primary.