Moving to Medicare from an Affordable Care Act Plan

By Dave Trout

Lots of us are becoming eligible for Medicare every month and we are confused to say the least. As an agent for twenty-five years, I have heard the most common questions folks have. Rather than starting with all the technical stuff, let’s see if I can help bring some sunlight into this process.

As you approach age 65, let’s say that you have coverage on an employer plan or Obamacare i.e. Affordable Care Act Marketplace plan. One option is Medicare Advantage Plans. These look very similar to what you currently have: copay’s, deductibles, medical maximum out of pocket, networks for doctors, RX drugs covered and the ‘ extras ‘ dental, vision and hearing.

All at a low or zero cost to you monthly beyond your Medicare Part B premium. That said, there are important differences you will need to understand. Alternatively, we have the choice of MediGap i.e. Supplement plans.

These are stronger for the medical coverage and work for any doctor who takes Medicare but has a more expensive premium. More about this in subsequent articles or on our website below.

A BIG Difference between over and under 65 plans: RX and medical costs are not in the same bucket. With under 65 plans, the copays for RX drugs count to the same maximum as your medical costs. Under Medicare, RX is entirely separate. Good news, in 2025, the out pocket maximum for Rx with Medicare is scheduled to be $2000.

Transition to Medicare from Affordable Care Act Marketplace i.e. Obamacare plans can be a confusing process.

Be aware of the very important details. The rules state that: if you are eligible for Medicare, then you are no longer eligible to receive a subsidy to lower your premium. This change affects not only your medical insurance but also your tax return.

Many folks of more modest income receive a substantial subsidy as well as enhanced benefits. Even though it may look better if you keep that coverage, you lose the tax credit and premiums for a 65 year old person are very, very expensive. Others of you with higher premiums will find Medicare to be a real plus to your bank account.

You should start to enroll in Medicare A & AMP; B three months before you turn 65. See www.ssa.gov and look for “Sign up for Medicare”. This will generate your coverage and your Medicare Beneficiary Id (MBI). You need this to enroll in any plan: Advantage, Part D Rx or MediGap.

Finally … Why is my mailbox full of junk ? This is the biggest question I get. Your birthdate is accessible to marketing organizations. Insurance companies want you to sign up with them. Independent agents like myself represent a number of different companies and plans.

We are licensed as “fiduciaries”; meaning that we are obligated to provide the best solution for our client’s individual needs. Within all that mail, watch for the official communications from Social Security and Medicare.

Dave Trout