If I’m covered by the Affordable Care Act, do I have to switch to Medicare?

Editor’s Note: Journalist Philip Moeller, who writes widely on health and retirement, is here to provide the Medicare answers you need in “Ask Phil, the Medicare Maven.” Send your questions to Phil.

Mike – Calif.: I have an Affordable Care Act policy from my state exchange. I just turned 65 and wondered if I can keep it or if I need to quit this plan and enroll in Medicare to avert a late-enrollment penalty? I do not have workplace health insurance.

Phil Moeller: Yes, you must switch onto Medicare. Your enrollment period includes the month you turn 65 and the three months after. But the sooner you switch the better. You don’t want to have a big health care expenses in, say, March, only to discover that your exchange plan is refusing to pay, because it says you’ve turned 65 and should be covered by Medicare. The first thing I’d do is call your current insurer and see what types of Medicare policies it offers. If you like your current plan, I’m betting your insurer would be delighted to move you into a comparable Medicare offering. However, this is also the right time for you to take a broader look at Medicare offerings to make sure you’re making the choice that best fits your health needs. Good luck!

Ann – Okla.: Is there a schedule of benefits for Medicare like we got from our workplace group insurance plans? I hope this is not a stupid question — I didn’t know where to look.

Phil Moeller: This is anything but a stupid question. And I bet there are millions of people like you who would love to see a schedule of Medicare benefits. The fact that this information is so hard to compile, let alone find, is an enormous failing on the parts of Medicare and the private insurance companies that sell various Medicare policies. Sure, they each have their own guides. But there is no mechanism to put together all the possible pieces into a complete picture. Maybe someone will write a book about this, and, wait, I just have! It will be out in the fall, by which time you may need to file a Medicare claim, because of how sick you’ll get from reading all of my shameless book plugs.

Seriously, here are some of the Medicare guides produced by the Centers for Medicare & Medicaid Services: “Medicare & You,” “Your Medicare Benefits,” “Enrolling in Medicare Part A & Part B,” “What’s a Medicare Advantage Plan,” “Your Guide to Medicare Prescription Drug Coverage,” “Choosing a Medigap Policy,” “Your Guide to Medicare’s Preventive Services,” “Medicare’s Coverage of Diabetes Supplies & Services” and “Your Guide to Medicare’s Durable Medical Equipment.”

If you have more detailed questions, odds are there is a Medicare guide. Then, as you get closer to buying private Medicare policies — for Medigap, Medicare Advantage or Part D prescription drug plans — insurance companies will have their own detailed guides to what their policies cover.

William: I’m in the process of planning for retirement and finding Medicare coverage for my wife and myself. Could you review my cost calculations and let me know if they’re accurate?

Part B premium: $104.90 a month times 12 months times two persons = $2,517.60 a year.

Medigap Plan F premium: $114.00 a month times 12 months times two persons = $2,736.00 a year.

Annual deductibles for Parts A and B: $1,260 (A) plus $147 (B) times two persons = $2,814 a year.

Estimated annual out of pocket cost for Part D of $5,000 a year.

The total would be $13,067.60. Am I missing something?

Phil Moeller: William is close, but not quite there. In part, this is because he based his calculations on a mistaken answer I provided in an earlier Ask Phil column (later corrected). As my wife reminds me regularly, please check any notions of infallibility at the door.

William is correct about Part B premiums. I’m assuming he also checked Plan F Medigap premiums where he lives using Medicare’s Medigap Policy Search tool. So, he’s two for two so far.

His figures for the Part A and B deductibles are out of date. For 2016, they have increased to $1,288 for Part A and $166 for Part B. However, if he and his wife have Plan F Medigap policies, these annual deductibles would be covered. So he can take these possible expenses off the board (and deductibles, of course, only come into play if you need care).

Lastly, he presented a ballpark out-of-pocket estimate for two Part D drug plans. This is a fine starting point, but I’d suggest he do some more homework. He should use Medicare’s Plan Finder, set up accounts for himself and his wife, enter the specific prescription drugs that each of them take, and get a more accurate estimate of what each of them might need to spend. This should include whatever Part D premiums they pay plus a separate annual deductible for Part D. It can be up to $360 in 2016, and unlike deductibles for Parts A and B, the couple’s Medigap plans would not cover this.

Charlene – Miss.: Is it too late to get a supplementary Medicare plan such as Medicare Advantage? I only have Original Medicare and Part D now. Will I have to pay a penalty forever?

Phil Moeller: Good news. There is no late enrollment penalty for switching from Original Medicare to Medicare Advantage. The penalties for late enrollment involve signing up for Original Medicare (Parts A and B) and Part D in the first place. Normally, you would need to wait to sign up for a Medicare Advantage plan until the annual open enrollment season begins this fall. It runs from Oct. 15 through Dec. 7. However, if there is a 5-star plan you like (Medicare’s highest quality rating) you can sign up for it right away. These plans have something like a 51-week open enrollment period, which in practical terms means you can sign up for them pretty much any time. However, you can do this only once a year.

Kent – Ga.: I am a retired Federal employee with Federal Employee Health Benefits (FEHB) insurance. I am currently in my initial enrollment period for Medicare and already signed up for Medicare Part A. I am employed with a large company (over 10,000 employees) and can sign up for their health insurance, which can help me avoid any monthly premium penalties when I decide to enroll in Medicare Part B later. However, I turned 65 between open seasons to enroll in my company’s health insurance plan and won’t be able to sign up for it until after my IEP is over.  Will I be able to avoid future Medicare Part B premium penalties if I am not currently enrolled in my company’s health plan before my initial enrollment period ends?

Phil Moeller: The answer depends on how long you are without health insurance. However, rather than going that route, why don’t you just keep your Federal Employee Health Benefits coverage until your new employer coverage takes effect? Unlike virtually every other retiree health plan, Federal Employee Health Benefits coverage may be retained in place of Medicare, thus avoiding the issue of late enrollment penalties altogether. So, I’d explore continuing that plan. Once your new coverage is in effect, you can switch to it. You should talk about this with the administrator of your current Federal Employee Health Benefits plan. Also, find out whether you could go back to it once you retire from your new position. It might be a superior solution to your Medicare options.

Nora – Fla.: If you have a health savings account and you enroll in Medicare, I understand that you can no longer make contributions to it. But can you still take health savings account distributions from your health savings account account to pay for COBRA and Medicare premiums and other qualifying health expenses and put these distributions on your IRS Form 8889 when filing your tax return if you are 65 years old?

Phil Moeller: Yes.

Elliott – Ala.: I will turn 65 in March 2016 but do not plan to retire until 66 1/2. I am a contractor with COBRA coverage from a previous employer. It will expire in June 2016. Can I receive Medicare Part A, Part B, Medigap and Part D drug coverage to take the place of the COBRA even if I’m not retired? Or do I have to be retired and taking my Social Security to receive Medicare?

Phil Moeller: If you are 65 and do not have workplace coverage (and COBRA does not count as workplace coverage) you are eligible for Medicare. In fact, if you don’t sign up for Medicare during your initial enrollment period (a seven-month period with your birth month in the middle), you would incur nasty late-enrollment penalties. Whether or not you are taking Social Security benefits has no bearing on your Medicare eligibility or timely enrollment obligations.