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How does the Marketplace affect my Medicare coverage?

[x_blockquote cite=”Josephine (Cumberland, RI) ” type=”left”]Dear Marci,

How does the Health Insurance Marketplace affect my Medicare coverage?[/x_blockquote]

Dear Josephine,

The Marketplace (also known as the Exchange) does not change your Medicare benefits or how you access them. Individual Marketplaces provide a way for people who lack health insurance to get coverage. However, Marketplace policies, also known as Qualified Health Plans (QHPs), are not meant for people who qualify for Medicare. Medicare Advantage Plans, Medigaps, and stand-alone Part D plans are not sold through the Marketplace.

If you are eligible for Medicare, in most cases you should not use the Marketplace to get health and drug coverage. Limited exceptions include if you qualify for Medicare based on having End-Stage Renal Disease (ESRD), or if you do not qualify for premium-free Part A. In these cases, a Marketplace plan might be an option for you.

Otherwise, if you already have Medicare, there are a few reasons you should not enroll in a QHP:

  1. It is illegal for someone to sell you a QHP if they know you have Medicare.
  2. You are not eligible for any tax credits to help pay for QHP premiums. QHP premiums are more costly than your Medicare, Medigap, or Part D premiums.
  3. There is no guarantee that a QHP will pay for your health costs if you were to drop Medicare to take a QHP.

If you are enrolled in a QHP and then become eligible for Medicare, there are steps you should take to enroll in Medicare. These steps will help you avoid gaps in coverage or penalties:

  1. You should enroll in Medicare as soon as you are eligible.
  2. You should drop you QHP coverage. If you get your coverage through the federal Marketplace, disenroll by calling the Marketplace Call Center or by going online at www.healthcare.gov. If you get your coverage through a state-based Marketplace, contact your plan or the state-based Marketplace to find out how to disenroll.
  3. After you enroll in Medicare, consider how you want to get your Medicare coverage. Medicare beneficiaries have the choice between Original Medicare through the federal government and a Medicare Advantage Plan through a private insurance company.

If you have a Small Business Health Options Program (SHOP) plan that your current employer purchased through the Marketplace, then the rules are a little different. If you have a SHOP plan through a current employer, you will still need to enroll in Medicare; however, the timing of your enrollment and whether Medicare will pay first or second depends on the size of your employer and whether you qualify for Medicare based on age or disability. If you have a SHOP plan, talk with your employer about how your coverage works with Medicare.

You may hear a lot about the Health Insurance Marketplaces, but just know that apart from for limited exceptions, Medicare beneficiaries do not need to use them to get their health care coverage.

– Marci

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