This Happens. Ugh.
Maximize Your Medicare lists a set of Special Enrollment Periods, which I call “side doors.” It can be VITAL that someone understands these if you are selecting a Medicare configuration, and you are not first turning 65 years old. If you are first turning 65 years old, then you have unrestricted rights to any Medicare configuration. ANY.
The Number of People Enrolling Later Will Increase
People will work longer, beyond the age of 65, even if the only reason is to keep working until Social Security’s full retirement age (FRA). That will mean that people will ignore the protected rights of a person when he/she first turns 65, for a variety of reasons.
Back to This Happens….
A person works beyond the age of 65, and maintains his employer-sponsored coverage, and delays enrollment in Part B. That is somewhat understandable. Depending on the PRICE of his spouse’s coverage, that may or may not have been the efficient choice. It needed to have been fully examined at that time, it was not (as far as I can tell). That’s oversight #1.
The person stops working, and the representative that had enrolled the employer suggests a Medicare configuration (one that is too costly, with inferior coverage). It isn’t clear how/why this occurred, I get to say “I wasn’t there.” That is oversight #2.
Two years later, medical bills and the out-of-pocket expenses start to build, and this person’s total medical bills rise, which could’ve been avoided. Medicare rules would’ve allowed an adjustment if that adjustment had occurred within 12 months of oversight #2. But now, two years have passed. That is oversight #3.
Now, the individual calls me, and the only option is to apply for Medigap, but the outcome is entirely uncertain, because during the time that the oversights 1-3 occurred, medical events have occurred. Those records are fully documented, and subject to examination by the insurance carrier. The carrier has the discretion to accept or reject the application, and the individual cannot do anything about this (relatively speaking). This is an unintended risk taken by the individual. The message of Maximize Your Medicare is clear: taking financial risks is fine, taking unintended financial risks is not.
ALL of this could’ve been avoided, and especially oversights 2 and 3. Lower premiums, superior coverage, now both simple paths have disappeared, leaving only the most difficult path forward.
How Did This Happen?
Unfortunately, the way that “advice” is given to individuals and companies is different. It is almost impossible to tell exactly what has happened. At the risk of reckless speculation, there are two alternatives. The first is that the financial representative did not fully understand the consumer rights protected under Medicare, because that firm/agency/individual is focused solely on employer-provided benefits. The second is that the financial representative was acting in his/her interests, above the interests of the consumer.
Do either of these explanations seem palatable to you? Probably not to the individual involved, either.