When to take Social Security (and Medicare)

[retiredat48]

Aug 10, 2023 18:53:01 GMT bigseal said:

Win1177,

We took SS two years before reaching FRA. Wanted to start receiving it rather than waiting and regretting it later. Most of that money has been going to charities because we have more money than we can spend thanks to Uncles Warren and Charlie. I see no compelling reason for you to wait given your financial situation. Enjoy it while you are still healthy.

bigseal,...atta-boy girl? bigseal............+1.  Guess that means I agree.

R48

[liftlock]

Aug 10, 2023 19:09:25 GMT anitya said:

Aug 10, 2023 16:45:26 GMT Capital said:

What information were you required to give when applying for Medicare?  What documents were you required to upload to apply?  Did you have to estimate your modified taxable income for the year in which you turned 65? 

Applying for Medicare Parts B or D subjects high income earners to Medicare IRMAA Premium Surcharges which are normally based on one's MAGI Income from 2 years back.   One can request that IRMAA surcharges be reduced or waived if one's MAGI income will decline due a qualifying life changing event.  Retirement is one of the qualifying events. 

When I applied for Medicare, Social Security had, and probably still has, a standard form for making a Medicare Premium IRMAA surcharge reduction / waver request.  That form allows one to provide an estimate for your MAGI Income so that Social Security can calculate your IRMMA surcharge based on what you expect your MAGI to be, instead of basing your surcharges on your actual MAGI income from 2 years back.  That form can be filed when you apply for Medicare or as an appeal to the Medicare Premium notice that will arrive after filing for Part B or D.  The premium notice shows any IRMAA premium surcharges and the MAGi income that was used to calculate the surcharges.  One has 60 days to appeal the IRMAA surcharge shown on the premium notice by filing the surcharge waver / reduction form, but its probably a better idea to submit the form when applying for Parts B or D.      

[anitya]

It would be nice if the posts about Medicare are moved to a Medicare dedicated thread or the title of the thread is changed to include Medicare. (I book marked the thread and hopefully will remember that there is good info on Medicare as well.)

[Capital]

Aug 11, 2023 1:12:49 GMT anitya said:

Capital ,

"Medicare sent me a letter telling me what my premium was and why there was an increase."

I need some context. Increase from what if that is the first time you were told what your premium was? Thanks.

anitya , when I received the letter it was the first time Medicare told me. It's the same letter Medicare sends all recipients every year. My premiums also include the level 1 IRMAA add on premiums. That is the increase I was referring to. Your annual letter explains what and why you have a IRMAA premium if you do so.

Edit to add. The waiver liftlock referred to IRMAA has not yet applied to me. Once I retire it will probably due to the income drop.

[yogibearbull]

Medicare premium tiers along with IRMAA (for high incomes) are published annually. So, Medicare informs ALL in late-Fall about any annual increases and why. This would include existing Medicate/Medicare Advantage people including any new signups. The letter is personalized with Medicare premium and IRMAA details. It also explains the hold-harmless provision that limits Medicare premium increases for those paying for Medicare by deductions from their Social Security payments (applicable to most, but not I who is billed directly, or the new signups).

One year, the large Medicare premium increase was from the feared impact of a new Alzheimer's drug by Biogen, but parallel resistance by Medicare/CMS caused that 1st drug from Biogen to fail in the market. The industry drug pricing model until then seemed - get the FDA approval and then start charging outrageous prices (whatever the US market will bear) that private PBMs and healthcare systems would reluctantly but easily agree to, and then the Medicare will be forced to pay that high rate (as it couldn't negotiate drug prices by itself). Well, that model was broken. The subsequent Alzheimer's drugs from Biogen, Lilly, etc haven't had similar problems because the companies acted more reasonably on pricing - still high but not outrageous. The Inflation Reduction Act now allows Medicare/CMS to start negotiating drug prices - a gradual phase-in. The pharma industry has filed multiple lawsuits against this part of the law and that fight may end up with the Supremes. IMO, the pharma industry's constitutional argument is shaky - that the unusual current law that forbids Medicare from negotiating drug prices should continue for the benefit of the pharma industry.

www.cms.gov/newsroom/fact-sheets/2023-medicare-parts-b-premiums-and-deductibles-2023-medicare-part-d-income-related-monthly
www.medicare.gov/Pubs/pdf/11579-medicare-costs.pdf

[Chahta]

Capital : "Once I retire it will probably due to the income drop."

You must file a "life changing event" form to apply for the IRMAA reduction. It is not automatic.

[Capital]

Aug 11, 2023 11:37:04 GMT Chahta said:

Capital : "Once I retire it will probably due to the income drop."

You must file a "life changing event" form to apply for the IRMMA reduction. It is not automatic.

Chahta, I know that. All that is in my future in about 4 years. Looking forward to a life of gainful unemployment 

[Fearchar]

www.medicareresources.org/medicare-eligibility-and-enrollment/what-is-the-income-related-monthly-adjusted-amount-irmaa/

hmmm.....

They go back 2 years, but have an appeals process.

So, does that mean fresh retirees can always appeal until they are past the 2 year mark?

[Capital]

Aug 11, 2023 13:06:33 GMT Fearchar said:

www.medicareresources.org/medicare-eligibility-and-enrollment/what-is-the-income-related-monthly-adjusted-amount-irmaa/

hmmm.....

They go back 2 years, but have an appeals process.

So, does that mean fresh retirees can always appeal until they are past the 2 year mark?

See discussion at the LINK

[anitya]

win1177 ,

Does the system allow you to add Medicare to the title of the thread? If not, I will ask @chang to do the needful for you. If you have a preference for how to retitle the thread, pl let him know.  My suggestion would be - “When and how to apply for SS and Medicare”

Thanks.

[liftlock]

Aug 11, 2023 13:06:33 GMT Fearchar said:

www.medicareresources.org/medicare-eligibility-and-enrollment/what-is-the-income-related-monthly-adjusted-amount-irmaa/

hmmm.....

They go back 2 years, but have an appeals process.

So, does that mean fresh retirees can always appeal until they are past the 2 year mark?

I believe the answer is yes.  If a retirees income drops because of retirement, the retiree is entitled to have IRMAA based on what they will earn in retirement, rather than what they earned pre-retirement.  When filing a claim for reduced IRMAA a retiree needs to estimate what they expect to earn in retirement.  When I retired, I was told Social Security has a true up process to verify that a retirees actual MAGI income in retirement falls within the MAGI bracket the retiree estimated.  If the retiree under estimates their MAGI retirement income, then the retiree would be subject to additional IRMAA based on the retirees actual MAGI Income.  I imagine this process might have been / may still be a mess during the Covid years with declining incomes and the delays in processing tax returns.  

[win1177]

Aug 11, 2023 19:18:16 GMT anitya said:

win1177 ,

Does the system allow you to add Medicare to the title of the thread? If not, I will ask @chang to do the needful for you. If you have a preference for how to retitle the thread, pl let him know.  My suggestion would be - “When and how to apply for SS and Medicare”

Thanks.

I am not aware of a way to alter the title of a thread, and thus unable to “add Medicare” to the title. We may need o ask Chang to do that, although I was already aware I needed to apply for Medicare very soon, as I turn 65 in November. There are penalties if you do not apply around your 65th birthday, in that you have to pay higher Medicare premiums. 

Sorry,
Win

[steelpony10]

Medicare:

            www.aarp.org/health/medicare-qa-tool/when-will-i-get-my-medicare-card/#:~:text=You%27ll%20receive%20your%20card,first%20day%20of%20the%20month.

[chang]

Edited as requested.

[Fearchar]

Just a FYI; Earlier this year I turned 65.

So, on my actual birthday, I called the Medicare number and was scheduled for an telephone appointment with an agent.
Several weeks later, I had the appointment and talked with an agent for less than 20 minutes.
Because I was (and still am) employed with full medical benefits, it wasn't much of an interview.
A month later or so, my Medicare card arrives and I guess I'm meeting the requirements.
As I understand it, technically, I'm just in Part A: Hospitalization.

Some of the literature produced by our HR department hints that employees with Medicare
are treated differently that those who are not.
Not much detail from HR though and no communication from them specific to myself.

From my fellow employees in a similar situation, I understand that if hospitalized, Medicare would be billed first.
So, from this, I would imagine that the cost for insuring me should be lower.
However, coverage is for my family which includes a spouse (under age 65) and children.
It was 3 children, but 2 have since grown too old and are no longer covered.
Rates are the same no matter how many children.
The 3rd child will age out next year.
So, in 2025, I would enjoy a lower rate of just employee and spouse.

So, I'm thinking that this will end up being pretty much a mute point.
Technically, I'm probably less expensive to insure than when I was last year.
However, I doubt the company or the insurance carrier will reimburse me for that.
It is after all the various insurance companies that they use who offer rates and choices.
Also, the number of employees over age 65 is minimal.

If I really wanted to save money, then it would probably be smarter for me to enroll in one of the lower cost plans offered.
We have been in the Cadillac plan for years, but that is really another matter.

[yogibearbull]

win1177 , those penalties for late filing are forever (or as long as you live), not just one time. Only the employer coverage from active jobs allow delaying Medicare, not retiree insurance or COBRA - these rules are huge traps.

Fearchar , employers now have different policies. It used to be that people working at/beyond 65 would just continue on employer's group health. But now, many employers require Part A and/or Part B once an employee becomes eligible (somehow/anyhow) for those. The employers are looking for ways to cut costs.

I don't want to dwell on my unusual situation. But for example, I had to get a denial letter from Social Security at 65 that I wasn't eligible for Medicare at all (as my employer was exempt from SSA/Medicare - it later changed policies for newer employees), and then I got a letter from my employer a few years later that I would be kicked out of the retiree group health plan because I had suddenly become eligible for Medicare through my wife's work record.

[Deleted]

If I had a portfolio so large that it's more than my wife and I could ever spend, I would forego signing up for SS and help keep it solvent for those that do need it rather than stress over when to take it.

[retiredat48]

Aug 13, 2023 14:19:22 GMT @axe said:

If I had a portfolio so large that it's more than my wife and I could ever spend, I would forego signing up for SS and help keep it solvent for those that do need it rather than stress over when to take it.

Pretty benevolent post, axe!...Kudo.

OTOH one can take SS annually and donate to charities of choice.  

R48

[yogibearbull]

@axe , many who don't need Social Security take it and make donations with it or resend the $s back to Treasury or another government department. I had a friend who funded local school scholarships with his Social Security checks. If you just don't take it, the underfunded program remains underfunded and your good intentions may not move the needle.

[win1177]

Aug 13, 2023 14:19:22 GMT @axe said:

If I had a portfolio so large that it's more than my wife and I could ever spend, I would forego signing up for SS and help keep it solvent for those that do need it rather than stress over when to take it.

Axe,
I think we will either donate to charities of our choice or do something else with the money, rather than just “not take” the money. After all, over my entire career I have paid a PILE into social security. I also pay a boatload of taxes every year. My accountant jokingly says the IRS out to send me “thank you” letters each year. I might as well donate some money in directions I “support”, as opposed to some of the wasteful spending I see!

Win

[retiredat48]

I took the $2400 in gvt stimulus checks, and donated a total of $2750 to my high school"60th" class reunion in Penna....with the proviso that the money would fully pay the fee for any and all attending...all costs. And that the approx $750 not needed (remaining) was to be put up as a one-for-one matching donation program to enhance the class bank account. Got matching $750 in donations within the first day of announcement.

BTW this action encouraged a reclusive classmate doctor who has never attended a reunion, to write a donation check for $1000 and sent it in with no accompanying note or letter! Just the check.

BTW #2: my classmates finally like me!

R48

[Schroeder]

If you have private insurance and delay medicare coverage be sure to keep good records.  I delayed it until 70.  When I signed up they sent a letter informing me they considered me guilty of going without health insurance and would charge me a monthly premium for the rest of my life.  I had all of the records to prove I was covered and the appeal went back and forth for three months until they cancelled the premium.  Then, they sent a letter about not having prescription coverage and they would add a premium for that.  It only took one letter and a copy of my old insurance cards with RX coverage to clear up that.  Now I only pay the correct amount.

Win, I hope you are getting along with all those Gamecocks OK.

[win1177]

Aug 14, 2023 14:40:39 GMT Schroeder said:

If you have private insurance and delay medicare coverage be sure to keep good records.  I delayed it until 70.  When I signed up they sent a letter informing me they considered me guilty of going without health insurance and would charge me a monthly premium for the rest of my life.  I had all of the records to prove I was covered and the appeal went back and forth for three months until they cancelled the premium.  Then, they sent a letter about not having prescription coverage and they would add a premium for that.  It only took one letter and a copy of my old insurance cards with RX coverage to clear up that.  Now I only pay the correct amount.

Win, I hope you are getting along with all those Gamecocks OK.

Schroeder, 
It is sometimes hard to live in the middle of “Gamecock country” and be a huge Ga. Bulldog supporter! We actually cheer for SC except when they play Ga. We cheer for Clemson, except if they play Ga. or USC Gamecocks. It was even harder to be here (Columbia, SC) when I was teaching at the USC School of Medicine. I could get tickets, but they were always in the USC sections, which made it hard to cheer for Ga. at games. But now, we just watch games on TV, better views (and don’t have to deal with obnoxious drunks)! 

We have had medical coverage and prescription coverage since I retired from the state (USC School of Medicine), but it automatically becomes a secondary insurance when I become eligible for Medicare. So in essence I have to sign up for Medicare, which I will do right now.

Win

[anitya]

I was trying to learn about Medicare and came across this link in my search but a better resource could be Medicare site itself.

www.ncdoi.gov/consumers/medicare-and-seniors-health-insurance-information-program-shiip/basics-medicare-parts-b-c-d

Schroeder post makes me think the US Govt wants everybody to sign up for all aspects of health insurance and are very aggressive (draconian) about it. Why do they think anybody old enough to qualify for Medicare and able to pay will go without health insurance? This is going to get worse with fiscal deficits.

It seems Medicare A is free and so, no reason not to sign up. If you live abroad (where Medicare does not cover), can you avoid signing up for Medicare part B and D and not pay a penalty or surcharge after you return to the US permanently.

[Capital]

Aug 14, 2023 15:53:40 GMT anitya said:

I was trying to learn about Medicare and came across this link in my search but a better resource could be Medicare site itself.

www.ncdoi.gov/consumers/medicare-and-seniors-health-insurance-information-program-shiip/basics-medicare-parts-b-c-d

Schroeder post makes me think the US Govt wants everybody to sign up for all aspects of health insurance and are very aggressive (draconian) about it. Why do they think anybody old enough to qualify for Medicare and able to pay will go without health insurance? This is going to get worse with fiscal deficits.

It seems Medicare A is free and so, no reason not to sign up. If you live abroad (where Medicare does not cover), can you avoid signing up for Medicare part B and D and not pay a penalty or surcharge after you return to the US permanently.

Medicare Part A is free. Just remember that if you sign up for Medicare Part A at age 65 you are no longer eligible to make contributions to your HSA. Any Medicare coverage eliminates that option. 

[archer]

I suggest running some calcs, plugging in whatever numbers seem appropriate to you. To use my situation as an example, I wanted to see which option (delaying or not) would result in the most money in my hands at age 88. So, I added 20 years of SS income at my benefit amount starting at Jan 2024, and added to that my PF value based on 5% growth. Then I compared this to delaying a year, adding up 19 years of SS benefits (at an increased rate). I added up the same PF value but subtracted a years living expense. This of course resulted in lowering my PF value at age 88, enough so that the increased SS benefit didn't make up for the difference. End result I will have more money at age 88 if I claim sooner than later. Waiting a year and receiving an 8% raise doesn't warrant delaying in my case. I know the above might be hard to follow, but my point is to just run some calcs that seem a good fit.

Plugging in different numbers might support delaying a year, but I only plugged in the numbers that fit my situation.

Doing calculations like these can be risky, as it is always possible that we are not taking everything into consideration. I have read several articles recommending living off of savings to delay SS and they show the math to prove their point. However, while the math is correct, the equations seemed irrelevant, at least to me.

[anitya]

Medicare Part B costs money and the premiums are based on your income, with some paying more than $500 per month. Given it does not cover outside the US, does the Govt allow you to discontinue Part B for the full months you are outside the US? Some retirees live outside the US for part of the year.

chang lives outside the US entirely. It seems unfair to ask him to pay for Medicare Part B when he does not live in the US or pay penalties if he decides to move back to the US at a later time.

[yogibearbull]

There are stiff penalties to delay Medicare Parts B & D. Even when one has overlapping COBRA or retiree coverage (that don't count for Medicare delays), the government's view is that have overlapping/double coverage to avoid Medicare penalties -- the indirect message is that ditch COBRA/retiree coverage ASAP.

My guess is that temporary shifts to overseas won't count for allowable breaks/delays. One may have to do cost-benefit analysis of just keeping Medicare (probably not useable overseas, but some medical aspects may be covered) vs late-penalties vs private health insurance.

www.medicare.gov/basics/costs/medicare-costs/avoid-penalties

[liftlock]

Aug 15, 2023 0:07:41 GMT yogibearbull said:

There are stiff penalties to delay Medicare Parts B & D. Even when one has overlapping COBRA or retiree coverage (that don't count for Medicare delays), the government's view is that have overlapping/double coverage to avoid Medicare penalties -- the indirect message is that ditch COBRA/retiree coverage ASAP.

My guess is that temporary shifts to overseas won't count for allowable breaks/delays. One may have to do cost-benefit analysis of just keeping Medicare (probably not useable overseas, but some medical aspects may be covered) vs late-penalties vs private health insurance.

www.medicare.gov/basics/costs/medicare-costs/avoid-penalties

The lack of guaranteed insurability might be the bigger cost of not signing up for Medicare within the initial penalty free sign up window. Missing the initial sign up window subjects one to underwriting.
 

[anitya]

Given non-existent Medicare coverage outside the US, retirees living outside the US buy health insurance locally. Based on @shroeder’s post, whether that insurance would be acceptable to Medicare to avoid future penalties is anybody’s guess. Seems like the US Govt is very punishing to retired people, making getting old that much more painful and expensive.