It happens frequently. A working spouse turns 65, retires and signs up for Medicare coverage leaving the younger, non-working spouse without health insurance coverage.
“Sometimes couples forget that Medicare is not like health insurance from an insurance carrier,” notes Alan Weinstock, an insurance broker at MedicareSupplementPlans.com. “Medicare doesn’t have a family plan. You have to be 65 or older to enroll.” That is unless you become eligible before the age of 65 due to a disability.
One Spouse Needs to Keep Working
The best option when only one spouse becomes eligible for Medicare is for someone to keep working.
If that is the older spouse, that means he or she will have to continue working until their younger counterpart reaches the age of 65 and is eligible for Medicare on their own. Or if the younger spouse is employed as well, that person will need to switch to the health insurance that is available through their own employer once their spouse changes to Medicare.
Choose COBRA for a Short-Term Transition
Another option when someone retires and enrolls in Medicare is for their spouse to take advantage of COBRA.
COBRA (Consolidated Omnibus Budget Reconciliation Act) provides workers and their families who lose their health benefits the option to continue group health benefits provided by their group health plan.
It is available for a limited period of time – generally for up to 18 months – after a worker leaves an employer.
What is good about COBRA is that it allows a spouse to receive coverage, even if the retiring employee chooses not to take it. If all you need is an additional 18 months or so until you are also eligible for Medicare, this might be the perfect option.
Individual Health Insurance Coverage
Naturally, one way to get health insurance is to buy a private policy.
An individual plan can be selected based on your personal needs. Keep in mind it can be costly and sometimes difficult to get for those who are older or who have pre-existing conditions.
For issues with pre-existing conditions, one option is HIPAA-protected health insurance. There are specific guidelines regarding how the Health Insurance Portability and Accountability Act (HIPAA) works including the impact of when you last had health insurance coverage or treatment for the condition. For more information, check out the U.S. Department of Labor HIPAA FAQs.
Finally, you might consider investigating a high-risk pool operated either at the state or federal level. There are 34 states that run health insurance programs for individuals with pre-existing conditions. While the cost and benefits vary from state to state, the rates tend to be high. In addition, under the new health care law, the federal high-risk pool guarantees coverage for those who are otherwise uninsurable. You must be without any health insurance for six months before applying.
Whatever choice you make when it comes to health insurance, it is important to remember to sign up for Medicare when you or your spouse is eligible or risk penalties.
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