Penalties Loom for ACA Enrollees Who Don’t Switch to Medicare Until September 2018
In America, turning 65 years brings with it some changes in health plans for individuals enrolled in the Affordable Care Act marketplace. Americans who are over 65 years and have their health insurance coverage through an Affordable Care Act (ACA) marketplace, are in danger of having to pay higher premiums for the rest of their lives if they don’t switch to Medicare until September 2018.
This penalty was established by the federal government so that individuals who are eligible for Medicare wouldn’t wait until they were sick to enroll. For an insurance program like Medicare to work properly, there is need for the enrollment of younger and healthier people as well as those who are older and need more medical care.
The federal government fixed the original deadline on the 30th of September 2017 but it has now extended the deadline until Sep. 30, 2018 to enable people who are over 65 and still enrolled in a marketplace plan until Sept. 30 to move to Medicare Part B to avoid incurring a lifetime late-enrollment penalty.
Individuals are required to enroll up to three months before or until three months after turning 65 to avoid penalties for late enrollment, unless they receive insurance through a large employer.
In America, a greater majority of individuals over 65 already are signed up for Medicare either because they were enrolled automatically and are collecting Social Security benefits or because they signed up right before or right after their 65th birthday.
However, there are indications that some people over 65 are still getting their insurance through the health care law marketplaces. According to a report by the Department of Health and Human Services, as at February 2016, nearly 100,000 people over 65 were enrolled in ACA marketplace plans.
Out of this number, some people signed up notwithstanding all the publicity surrounding the passage of the ACA and just never thought about switching to Medicare when they turned 65.
While others took a deliberate decision to stick with an ACA plan when turning 65 because they were receiving a federal tax credit or subsidy that made their health premium on the ACA marketplace cheaper than the Medicare Part B premium.
For those that stuck with their ACA marketplace, there are two problems to envisage; one is that, when they turn 65, they will no longer be eligible for the ACA tax credit or subsidy and they will only discover this during renewal of their plans and second is that when the individual discovers this and wants to sign up for Medicare Part B because that premium is now cheaper than the ACA plan, the premium will be 10 percent higher for the rest of their lives because it will include a late-enrollment penalty.
Several people have found themselves in this predicament and do not know what to do next. However, the Centers for Medicare and Medicaid Services (CMS) has come out with a plan which enables people to switch from an ACA plan to Medicare Part B without incurring the late-enrollment penalty.
For more information on how to take advantage of this penalty waiver, affected individuals should contact the Social Security Administration at 800-772-1213 or go to SSA.gov to find the nearest Social Security office.