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Deferring Medicare Part B Enrollment

Posted By Dennis Damp On In ANNUITIES / ELIGIBILITY,BENEFITS / INSURANCE,FINANCE / TIP,SOCIAL SECURITY / MEDICARE,SURVIVOR INFORMATION,UNCATEGORIZED | Comments Disabled
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Updated 11/11/2024

I presented a briefing for the Employee’s Retirement Club at the Food and Drug Administration (FDA) at the invitation of the group’s chairperson. We discussed a number of topics including FEGLI [2], Long Term Care [3], and Medicare signup. There was some confusion about the ability to defer Part B premiums if your spouse continues to work and you both are covered under a FEHB plan. Fortunately, one of the participants was able to provide clarification based on her research.

 

 

When I turned 65 my wife was already retired therefore I immediately signed up for Medicare parts A and B. I didn’t have the option to defer Part B because my business is a single owner LLC and does not offer health insurance. My wife and I are covered under my FEHB enrollment.

The First Step

If you are still working and have health coverage from your employer your spouse can defer signing up for Part B and sign up later without penalty per the Medicare Booklet [4], page 19.

According to Medicare, you will not pay a penalty “as long as you’re eligible for and enroll during a Special Enrollment Period. If you wait to enroll in Part B because you or your spouse are working and have group health coverage through an employer or union based on this current employment, you can enroll during a Special Enrollment Period. You can sign up for Part B during one of these times:




Part B Premiums

The Part B Medicare premium for those signing up for the first time in 2024 is $174.70 a month.  Use OPM form 2809 [5] to document that you and your spouse are covered by an FEHB plan if you do decide to defer enrollment and discuss this with your agency’s retirement counselor or HR department.

One of the primary reasons people decide to defer signing up for Medicare Part B is due to the income adjusted amount individuals must pay if their total income is over certain limits. According to Medicare, if your modified adjusted gross income as reported on your IRS tax return from 2 years ago is above a certain amount, you’ll pay the standard premium amount and an Income Monthly Adjusted Amount, also known as the IRMAA is an extra charge added to your premium.”

Review the IRMAA 2024 premiums online [6]. We will publish the 2025 rates as soon as they are released.

For example, if in 2024 you sign up for Medicare Part B and your Joint income was equal to greater than $206,000 and less than $258,000 as reported on your 2023 tax return your Medicare Part B premium would be $244.60 per person.  Your modified adjusted income includes most of your income without any exemptions. The top monthly rate for incomes greater than or equal to $750,000 for joint filers is currently $594.

Those subjected to these higher rates may find it advantageous to defer signing up until their working spouse retires.

Here is a list of articles that cover sighing up for Medicare that you may find helpful. They include an in-depth discussion on this subject:

There are distinct advantages to signing up for Part B since most FEHB providers pay all of the coinsurance, deductibles and copayments when Medicare is your primary provider. Take your time deciding on what direction you will take, there is much to consider and the impact on your finances can be significant if you make the wrong decision for your circumstances.

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Disclaimer: Opinions expressed herein by the author are not an investment or benefit recommendation and are not meant to be relied upon in investment or benefit decisions. The author is not acting in an investment, tax, legal, benefit, or any other advisory capacity. This is not an investment or benefit research report. The author’s opinions expressed herein address only select aspects of various federal benefits and potential investment in securities of the TSP and companies mentioned and cannot be a substitute for comprehensive investment analysis.

Any analysis presented herein is illustrative in nature, limited in scope, based on an incomplete set of information, and has limitations to its accuracy. The information upon which this material is based was obtained from sources believed to be reliable, but has not been independently verified. Therefore, the author cannot guarantee its accuracy. Any opinions or estimates constitute the author’s best judgment as of the date of publication, and are subject to change without notice. The author explicitly disclaims any liability that may arise from the use of this material.

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