Medicare When Turning 65

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This is the Truth Network. Welcome to Finishing Well, brought to you by cardinalguide.com, with certified financial planner, Hans Scheil, best-selling author and financial planner, helping families finish well for over 40 years. On Finishing Well, we'll examine both biblical and practical knowledge to assist families in finishing well, including discussions on managing social security, Medicare, IRAs, long-term care, life insurance, investments, and taxes. Now, let's get started with Finishing Well. Darrell Bock Welcome to Finishing Well, with certified financial planner, Hans Scheil, and today, how fun.

Medicare, what you need to know, especially if you're turning 65. And so, you know, a lot of times, you may think that we make things too complicated, but we're hoping to make it really simple today. And also, you know, when I was thinking about this, Hans, that often we have a tendency to make religion really complicated. Like, you know, there's all sorts of doctrine and all sorts of things that seem to be really important, but I did want to just say, you know, when it comes to Christianity, here's what you need to know. Hans Scheil Well, just tell them what you just told me five minutes ago.

Darrell Bock Okay. Jesus is who he said he is. He is, in fact, God, and he is, in fact, God's Son. And he lived a perfect, sinless life, was born sinless as a virgin virgin birth. And because he was sinless, when he went to the cross and was found totally guilty when he was totally innocent, that price that he paid, his literal death, was the price for my sin and the wages of sin of the death.

And so, I'd had a lot of that, and so I needed him to die for my sin in order to be set free of my sin so that I could spend eternity with him in heaven. And if I accept that on faith, if I truly believe that in my heart that Jesus was and did exactly what I just said, and then I ask him to be my Lord and the Savior, simple enough, you've taken the steps that here it is. That's the gospel.

Dr. Darrell Bock Yeah. It's that simple. And we could just kind of end the show right here because I've gotten my lesson. And the parallel that I was drawing earlier is that I need to listen to that in terms of me practicing financial planning, me doing radio shows, me doing YouTube videos, which we put a lot of energy into these. And something I've done over the last few years is I've tried to do a better job of being organized, documenting all this stuff, documenting the facts behind what we're saying, what we're doing, getting out of the Medicare, the law, the regulations. And I way overdid it on some previous videos where we just referenced everything that we're saying.

And I think we did just like if you're getting a Bible study and you get too deep into the facts and the quoting the Bible and going through and just studying the Bible is that you can lose sight of what you just said. Dr. Darrell Bock Right. You worship the knowledge rather than the person that wrote it. Dr. Darrell Bock Absolutely.

Because it's just a simple, simple thing that you need to do coming to the Lord. Dr. Darrell Bock Right. Dr. Darrell Bock And so, I mean, when we start talking about that and we get down to like signing up for Medicare, it kind of puts signing up for Medicare in perspective.

This is way less important than that. But I'm sure to some of you that are facing this, it's very important. And one of the things that I see goes on all the time is that people have these friends and the friend of a friend and their brother-in-law or somebody that's kind of a self-appointed expert on the facts and they've been through it themselves or they're the expert that's read one book and they give a lot of advice. And this person is not really referenced in the people that come into me, but they say, oh, I've been told.

I've heard that. You know, I thought this and a lot of times there's just when it comes to this Medicare stuff and specifically getting signed up to it, there's all kinds of… Dr. Darrell Bock Confusion. It adds to the confusion. Like it was confusing enough without this other information that doesn't seem to line up with, you know, what's going on. Well, and then a lot of times they come into me and they don't say that stuff right away. They're just saying, man, I'm confused. I don't know where I am.

Help me out. And then I start telling them what they need to do. And then they say, well, what about this?

And what about that penalties? And what about the three months before and the month of and the month that, you know, and it's just, it's like, holy moly. So what I've got to do is I've got to, we've got to get, I've got to unwind all that stuff you heard beforehand, which part of it's true. And I've got to get down to a base level. And then from there I can walk you through what you need to do.

So… Dr. Darrell Bock Which is simple, by the way. This is not hard. I've done it. Once you know what it is, you're like, oh, I could do this.

And it's kind of like the gospel. Once you know it, it's going to be easy. Dr. Jon Olin Okay. So if you're, we're going to use me for an example today. I'm born July 2nd, 1958. Dr. Darrell Bock Oh, wow. You are turning 65.

Dr. Jon Olin I am. Almost four months from now. I'm going to go on Medicare part A and part B, July 1st, which is the month of my birthday, because I'm July 2nd is my 65th birthday. But I can start Medicare July 1st. And you can Medicare can only start on the first of the month.

So just get that clear. And the way the rules state is, I can sign up for Medicare three months before, which for me would be April, May and June, any time during those three months, then Medicare will start July 1st. Or I could sign up the month of which is July. And then it'll start August 1st. Or I could sign up three months after up to which would be August, September and October during those months, and it will start on the first of the month following whenever I signed up. But you know, all that stuff after my birthday, let's just forget about it. I mean, if you need Medicare, you're going to sign up during April, May and June.

Just that simple. And I like April and May better than I like June. Because if you know, I get all kinds of people, what starts in two weeks, what do I do? Well, we're going to hustle around and get it straightened up. But how about we start this process in April?

Because it's just going to give us all kinds of time. I did it. It was really nice. Because, you know, all my cards were in place. And as it turned out, for me, that, you know, knowing Robbie is my family knows me.

That was a month I went in the hospital was October, you know, the month of my birthday. And boy, I needed all those cards, like right then. And I had them. Sure.

Sure. Well, and so that's the deal. And you're going to sign up for Medicare A, and you're going to sign up for Medicare B. Now, I'm going to back up a minute, is if you're taking Social Security already, if you started it before you were 65, you don't need to do anything, because Medicare is just going to sign you up. Social Security is going to sign you up. Really?

Oh, yeah. I didn't know that. Yeah, if you're taking Medicare, I mean, say taking Social Security, and you were started when you were 63 or something or 62. And you're just dancing along, you need to do a thing, they're going to mail you a Medicare card along about April, or May, like, but again, today's day and time, a lot of people aren't taking Social Security early, they're waiting, at least until full retirement age, a lot of people are still working. So don't anybody tell me, oh, they'll just sign me up automatically, or I just need to sign up when I'm turning 65. That's what the people are telling me.

Most people want to start their Medicare on July 1, the first of the month, their 65th birthday, but there's a whole area of exceptions. And that exceptions, they're all around one thing, are you still working? And do you have group insurance?

Ah, okay. So if you are still working, and you have group insurance, and it's creditable group insurance, or your spouse is still working, and your spouse has creditable group insurance, and they're covering you, you can delay too, as a spouse. So, and if you're still working, your accept your group insurance is good.

And I'll get into what creditable was in a second or in the second part of the show. But if you're still working for a big company, you got health insurance, you got your spouse covered. And the two of you are just dancing along fine. You don't need anything to do with Medicare, you can just delay. And we're gonna we're gonna get in the second part of the show.

Because don't just listen, oh, I don't need to listen to anything more. He said, I don't need no, wait a minute, there's some qualifications on this. And then we're going to talk about what you do when you finally do need Medicare, how you get on it. But just understand that there's one big exception on this is that still working, covered by group insurance, don't have to start up Medicare at 65. But some people still want to start Medicare. So you doesn't mean you can't get Medicare, it just means you may not want to. Which I didn't, you know, I was working and certainly had group health insurance.

But Medicare was so much less expensive with better coverage. And that was clearly obvious to me. But that may not be the case with you. So those are things you need to assess, right? Right. And this is the first decision and the first thing you need to be focused on.

Because most people that come into us or that call us or call me, they're walking in and they're thrown right out of the table. Well, you know, I want to get started. And I want to get started on the G plan. I want to get a Medicare Supplement G plan.

I don't want anything to do with those Medicare Advantage plans, or they're going to say, I want I want that Medicare plan and I want UnitedHealthcare AARP. That's what I want. And well, which kind do you want? Do you want the Medicare Advantage? Or do you want? No, I, I just want AARP.

That's what I want. And what are you talking about? What kind, you know, and people will come in, because they've been talking to somebody about what company they have.

And the somebody is real happy, or they talk to another salesperson, who just showed them that and pigeonholed them. And they never, they've never thought about getting on to Medicare, which you got to do first, and whether that's the right time. So we're going to take things in order here on the show. And in our practice, there's three decisions that you got to make. And not only do you need to make these decisions, but you need to make them in the right order. This is like, am I going to sign up for Medicare Part A and Part B now? Or am I going to delay? Wow. Again, simple enough. You know, am I going to sign up when? And when we come back, we'll get into all those other decisions and more along those lines.

Again, you're listening to Finishing Well. And of course, you can find out so much about this from the show notes, which are there at cardinalguide.com. It's cardinalguide.com. There you can find this tab that says Medicare. And there you'll find the show notes on today's episode, as well as all sorts of other resources on Medicare. And of course, Hans's book, The Complete Cardinal Guide, The Planning for and Living in Retirement, and most of all, the way to contact Hans to get advice for you because there is no cookie cutter approach to all this, believe me. So thank you.

We'll be right back with so much more Finishing Well. or endorsed by the Social Security Administration or any other government agency. Welcome back to Finishing Well, certified financial planner, Hans Scheil. And today's show is what you need to know if you're turning 65 on Medicare. And so when we left our hero, we're talking about this is really simple, three decisions that are coming at us.

And that first decision is simply, you know, when are you going to do it? Yeah, so this is the one that people start on when they're approaching Medicare, and they, they get signals from all over the place. And I'm going to just tell you what the deal is, is that if you already are collecting Social Security, which isn't as many people these days. But if you started your Social Security, in effect early, then you're just going to get a Medicare card, and it's going to have part A and part B on it mailed to you. And it's going to come about three months, two months before you turn 65.

I hate to confuse things, but that's me. So what if I am working, and I have credible life, I mean, credible health insurance, and I'm very, very happy with it's inexpensive and all that. And I don't want to go on Medicare. Yet I'm on Social Security. I started my Social Security early, not that that was a good idea.

But nonetheless, that that's the scenario. What do I do then? Then you just have to contact Medicare, I can help you do that. And you unsign up. Okay.

For part B, really only, and maybe part A, if you're on a flexible spending account or health savings account. But for most people, they're just coming up on 65. They got all this conflicting information. And a lot of people, their their source of information is two places. Number one, they've got the brother in law deal, or they've got the friend of a friend, or they've got some circle of friends. And some people become real busybodies about this stuff.

Okay. And they, they read a lot, maybe their spouse is a little older, and they've been through it. And they start telling everybody everything you need to do this, you need to do that, you need to get on this, you need to do that. And then that gets passed on through somebody else, told to you and just, I ran into people, they don't know what to do.

And so I'm going to try to clarify that for you today. So if you're not on Social Security, which is a lot of people, you're turning 65. And you're not covered by group insurance, then you need to sign up for Medicare.

And then, you know, another show another place, we can tell you how to do that. But if you are working, and you have group insurance, this is really the only exception to delay. It's through that group insurance that you're granted an exception from Medicare, you do not have to enroll, because you have creditable group insurance. And this covers your spouse too. I mean, we have a lot of people that turn 65.

And they're still working. And one of the reasons they're still working is their spouse is 62. And their spouse is covered under the group insurance.

And the only way they can keep the spouse covered as a dependent is to stay on it themselves and still work. So they're on a plan to get to 67 or 68. When their spouse turns 65.

That's when they're going to retire. Okay, those people, you can delay, you don't have to sign up for part A and part B, you can just simply delay, which is really doing nothing. Okay. And you don't have to sign a form to delay, you just do nothing, you just do nothing. Okay. Now, you could optionally sign up for a and it costs you nothing.

And I don't want to get into that today, because I'm trying to keep this simple. So if you've got creditable group insurance, so let's talk what does creditable mean? You know, creditable means your group, it comes from a company that has 20 or more employees, okay, or more than 20 employees. So it's what Medicare calls a large group.

And that's kind of it. And then it meets other minimum standards of health insurance, it's creditable. And the reason you want it to be creditable is because later, when you want to get on to Medicare, you're going to file for an exception. And we're going to help you do it. And so there's a form that you get filled out by your employer that just proves since you turn 65 to whatever the current date is, then you've maintained creditable group insurance, I can send you the form, it's in the show notes for the YouTube show.

You're just going to get your employer later to certify that you've had creditable coverage, and maybe you're same thing, you're gonna have to get a separate form for your spouse, if you're both of you riding this exception. And then you'll be granted a special enrollment period, and then we'll sign you up then or we'll get you signed up then. So and, frankly, people that are selling Medicare supplements don't really have an incentive to tell you about all that if you're turning 65. And I know that you people get contacted by tons of people trying to sell you this stuff when you're turning 65. They don't really have an incentive to say, hey, you don't need to do any of this stuff. You don't need to do any Medicare, you don't need to buy a supplement. They're just going to get into telling you which supplement is best. So there's kind of a built in incentive to incentive to for the salespeople to not really explain this exception to people. And we deal with it every day. I mean, we want we don't want you paying money for Medicare, and then starting a bunch of periods going if you don't have to, okay, if you're going to rely on your group insurance.

Now, that's really the first decision. I'm going to tell you also what is not covered, what is not creditable, because this is a big is COBRA. So we have people that say, Oh, I don't need to do Medicare because I got creditable group insurance because I got COBRA, you know, or my employer is paying for COBRA for me because they laid me off or something that doesn't count for the exception. So COBRA is not the same thing as creditable group insurance, retiree coverage, if somehow you've got insurance, group insurance that's based upon you being a retiree somewhere, you don't actively work there, that doesn't count. ACA coverage does not count. And nor does an individual policy. So it's only creditable group insurance that you can use for this exception.

So I mean, that's, that's kind of it. That's decision number one is you either need to sign up or you want to sign up, or you're working in an exception. So we want to get on to decision two before we run out of time. So decision two, now you're already signed up, you're, you're, you're getting part A, you're getting part B, if you're using me as an example, it starts July 1st.

Now the second decision that we have to make is a binary decision. It's either or I'm either going to stay on original Medicare parts A and B, or I'm going to go and buy a Medicare advantage plan. I'm going to go into managed care.

Okay. And if I stay on original Medicare, then it's recommended. You're going to need to buy a supplement and that's going to cost you some money. You know, maybe you're in North Carolina, a hundred, 110 bucks a month for the best one. Uh, maybe in Florida, 180 bucks a month for the best one. And in New York, 300 bucks a month for the best one, California, maybe like Florida, about 180 bucks a month, somewhere in there, you got to pay a premium. There's another little eye-opener that caught me by surprise, but not, I mean, based on your help, it didn't catch me by surprise, but still, I think I would not have expected it prior to Medicare is Medicare itself is going to cost you money. If you haven't started your social security, and even if you have started your social security, it's going to cost you money.

Yeah. It's going to cost 164.90 a month. And then if you stay on original Medicare, you're going to pay between a hundred, 150 bucks a month, 180 bucks a month for the supplement.

And what that's going to get you the two of those is wonderful coverage because you've just, most of the gaps are filled. You're going to have most of your bills paid. And it's also going to give you the authority or the ability to go to any doctor that takes Medicare anywhere in the United States. So you're not in a managed care system. You're, that's what I'm going to do, but I can afford to do it. Okay. Now I'm not going to say what I'm doing is best for everybody. I'm just saying you're in a binary decision here. Are you going to go on original Medicare?

You're going to pay money for that. Are you going to buy a supplement from a private insurance company and you're doing that. So you're not going to have very little out of pocket expenses. Number one and number two, you can go to any doctor of your choosing. Okay.

Right. Now the other side of the decision is to go onto the managed care plan and many of those have zero premium. So you're only going to have to pay that Medicare part B 164.90 a month. And then you don't have any other monthly costs and you get a drug plan that you are in managed care.

You got to go to their doctors. You're going to have some out of pocket every time. I mean, both sides have their pluses and minuses, but most people are not aware that this is a binary decision. I mean, people that just come into us is we know we can get into decision number three, which is which company and which plan am I going to buy? Either a Medicare supplement with original Medicare. We can look at all this in decision three and costs to make decision two.

But it's been my experience. People that come into me, they don't even know about decision number one and decision number two. They're just into like which policy and their plan of attributes of both. So I'm trying to tell you, it's as simple as the profession of faith that you gave in the very beginning of the show is, is that you sign up for Medicare parts A and B unless you have group insurance as an exception. Okay.

Number two, you, um, you, you do that and you sign up at SSA.gov and you get the Medicare started and then decision number three is a binary decision is, am I going to go Medicare advantage or am I going to go decision two, excuse me, is Medicare advantage or Medicare supplement. Right. Okay.

And I can help you walk through those things. But it is, it is. And it simplifies it to me like, and certainly there was a lot of information that's in decision number three that helped me make my decision on both ways. Cause I've been on both, but just understand that there is a difference between Medicare advantage and original Medicare. We never want people to lose sight of is the idea is that you have really good insurance that if you were to get bad sick, that you're going to be okay on Medicare is a wonderful thing. And it's less expensive typically than paying for group insurance, whether you're, you know, or underage insurance. So it's, it's all around a good deal. It's just getting people in the right place. Wow.

We're, we're so grateful for the actually wonderful process. This is, and we couldn't recommend enough that you just simply, you can make a simpler decision. It's like that one 800 Hans, you can go to cardinal guide.com and there you can just email him, call him, whatever you want to do. I mean, obviously we want to help you, you know, with this and, and there is no cookie cutter approach.

We understand that based on where you're working, what you're doing, all those things. It's all there at cardinal guide.com. And if you just want more resources, of course, they're there under the seven worries tabs, which one of which is Medicare. And so there you go. It'll have this show, show notes, all sorts of information, as well as Hans's book, the complete cardinal guide to planning for and living in retirement. Thanks Hans. Yeah.

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