Creditable Coverage!


By David S Edge

Many folks think it’s OK to not get Medicare A&B health coverage when they turn 65. Under certain circumstances they are
right, but under other circumstance,  they are wrong and can end up with a lifetime penalty!

When you turn 65, you do not have to get Medicare A or B as long as you have Creditable Coverage. Well, what exactly does that mean in plain English? “Creditable Coverage” means that your current health coverage is as good as Medicare health benefits.
Many times an example would be that you are going to keep working and keep your employer health coverage. But….there has to be at least 20 insured employees and the employee coverage plan has to be “Creditable Coverage”. How do you find out? Ask
your employer Human Resources Department (H.R.). In most cases you can just check your Benefit Summary Booklet provided by the Health Care Company for your employer. In that document it will clearly state “This plan is considered Creditable Coverage” or it will state “it is not”. If the Employer Health plan is not Creditable Coverage, it means that you can be exposed to a penalty that grows each month you do not sign up for Medicare A&B Health coverage. The really bad news is that this penalty never goes away and you pay it the rest of your life. Yikes!

A few misconceptions are that your employer COBRA health coverage qualifies as “Creditable Coverage”. IT DOES NOT!

Many Veterans put off signing up for Medicare thinking that V.A. Health coverage also qualifies for Creditable Coverage, IT DOES NOT! The V.A. drug coverage plan does qualify for Creditable coverage for a Part D Medicare drug coverage, but not the V.A. medical.

Veterans do not need to get Medicare if they choose to only have V.A. Health coverage. However, if in the future they decide to sign up for Part A & B of Medicare, they will pay the late enrollment penalty just like any other citizen. Many Veterans keep their V.A.
coverage and also get their Medicare A & B health coverage and then choose a Medicare Advantage plan, that in most cases in Maricopa County Arizona, have a $0 monthly premium cost. This way they can use the V.A. or use their civilian medical plan.
Confused or need more info? Call us! We can help!