I signed up for Medicare when I thought I was retiring but then decided to keep working. What do I do?

Janell Sluga Medicare & Individual Health Insurance Account Executive View Bio

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Question:

I was planning on retiring, so I signed up for Medicare Part A & B. Now I have decided to keep working. Since I don’t need Medicare anymore, can I cancel it? What about the premiums I’ve already paid?

Answer:

We all look forward to retirement, and then when it gets close, we sometimes have a difficult time deciding on the right time to retire. Changing your mind about the timing is common.

The answer is different when we talk the different parts of Medicare: Parts A, B, and D.

For Medicare Part A, if you choose to end your coverage you must repay any benefits you received from Medicare Part A. So, if you were hospitalized, or had any claims under Part A, you would have to repay those benefits. For this reason, and because you probably don’t pay a premium for Part A anyway, I would recommend you continue your Medicare Part A coverage.

For Medicare Part B, there is another item to consider: your current employer group size. If the employee group is less than 20 employees (or less than 100 if you qualified for Medicare due to a disability), then you must stay with Medicare A & B. If the employee group is more than 20 (or 100 employees if disabled), you could choose to drop Medicare Part B.

If you’d like, you can choose to stay on Medicare A & B AND keep your Employer Group Health Plan (EGHP). I often advise individuals to do so, regardless of group size, as the insurance can work well in combination.

When requesting the cancellation of Medicare Part B, you can ask that they cancel the coverage all-together, and that they pay you back for the premiums you’ve paid. Since that is only one or two months, that may be possible. This would make it as though you never had Medicare Part B at all. However, if you USED your Medicare Part B coverage to pay for medical care, you would be required to pay that back as well. So hopefully you did not access any medical care with your Medicare Part B coverage.

If you choose to drop Medicare Part B, you can start the process by contacting the Social Security Administration (SSA). You’ll be required to submit a written request to terminate coverage to the SSA. The SSA staff can give you this form and help you complete the necessary paperwork (Form CMS 1763). The completed form is then turned in to the SSA for processing. You also may be required to have a personal interview, either in person or over the phone. This personal interview with SSA staff ensures you are making an appropriate decision.

I would also recommend reaching out to SSA via phone call or walk-in visit to talk to them about the timing of this process. There are times when you can schedule an appointment pretty quickly with SSA staff, other times you may wait up to six weeks for an appointment. I never recommend waiting until the last minute to turn in paperwork to any organization, and SSA works best if it is not a last-minute step. Also remember that Medicare products always end and begin the first of the month.

If you have had Medicare for quite some time, but are just cancelling the coverage as of this month and you don’t want the premiums back, then there is another layer to this decision.

An interesting fact in your situation: you currently pay $185 for your Medicare Part B. If you drop your Medicare Part B coverage now at that $185 rate, when you re-enroll into Medicare Part B later, you will pay that same rate of $185, even if the has increased since you re-joined Medicare.

The decision for Medicare Part D requires that you evaluate whether your new EGHP includes “creditable coverage” for your prescription drugs. If the EGHP has “creditable coverage” for your medications, you do not need additional coverage through your Part D plan. Part D has nothing to do with size for the employee group – if the EGHP does NOT provide ‘creditable coverage,” then you must continue to purchase prescription drug coverage with a Part D plan approved by Medicare, regardless of your group size.

Most EGHP plans provide “creditable coverage,” but you must check this before you make your decision. The person who reviewed your insurance coverage at your new job should be able to answer this question for you.

Remember that you decided now to stay at work a little longer, you can change your mind and retire when you are ready and revisit the Medicare decision at that time. We will be here to help you with that when you are ready!