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Things to know about retiree health insurance

Things to know about retiree health insurance

It is important to focus your attention on getting health insurance as your retirement approaches. It can give you the peace of mind knowing that your health is covered. Retiree health insurance is when you are retired and have Medicare and group health plan (retiree) from a former employer. In such a scenario, Medicare covers your bills first followed by your group health plan.

Here are a few important things you need to know about retiree health insurance:

  • It is not mandatory for employers to offer retiree coverage. Therefore, find out if you can continue to receive coverage from your employer even after retirement. If you do receive retiree coverage, the employer or union exercises complete control over the benefits and premiums. They can even cancel your coverage.
  • Next, find out about the prices and benefits offered by the retiree coverage. Also, check if it offers coverage for your spouse. Most of the times, your employer or union has a limit on how much it will cover for you or your spouse.
  • Retiree health insurance may work differently with Medicare. Therefore, it is essential that you find out what happens to your retiree coverage once you become eligible for Medicare. For instance, retiree coverage will not cover your medical costs in the period you are eligible for Medicare but didn’t enroll into it. In order to avail all the benefits that retiree coverage has to offer you need to have enrolled in Medicare Parts A and B.
  • Retiree coverage may work differently with Medicare. Refer to your plan’s benefit booklet to know how your coverage as a retiree will affect your health coverage and your spouse’s health coverage. You can also derive this information from your employer’s benefits administrator. You can seek assistance from your State Health Insurance Assistance Program (SHIP) to determine if you will need a Medicare Supplement Insurance (Medigap) policy.
  • Federal COBRA rules can protect you if your former employer goes bankrupt and if any other company in the same corporate organization continues to offer a group health plan to its employees.
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