Health Coverage Options for Pre-Medicare-Age Spouses
Dear Savvy Senior,
My wife, who is 62, is on my health insurance plan through my employer. When I retire in a few months at 65, and go on Medicare, what are my wife’s options? Is there some kind of Medicare coverage for dependent spouses, or do we have to purchase Obamacare?
Medicare, unfortunately, does not offer family coverage to younger spouses or dependent children when you qualify for Medicare. Nobody can obtain Medicare benefits before age 65, unless eligible at a younger age because of disability. With that said, here are some coverage options, including Obamacare, to consider for your wife.
Keep working: If possible, consider working past age 65. This would allow your wife to continue coverage under your employer health insurance until she becomes eligible for Medicare.
Employer options: If your employer provides retiree health benefits, check with your benefits administrator to find out if they offer any options that would allow your wife to continue coverage under their plan. Or, if your wife works, see if she can she switch to health insurance provided by her own employer.
COBRA: If you work for a company that has 20 or more employees, once you make the switch to Medicare, your wife could stay with your company insurance plan for at least 18 months (but could last up to 36 months) under a federal law called COBRA. You’ll need to sign her up within 60 days after her last day of coverage. But be aware that COBRA isn’t cheap. You’ll pay the full monthly premium yourself, plus a 2 percent administrative fee. To learn more, see DOL.gov/ebsa/publications/cobraemployee.html or call 866-444-3272.
If, however, the company you work for has fewer than 20 employees, you may still be able to get continued coverage through your company if your state has “mini-COBRA.” Contact your state insurance department to see if this is available where you live.
Individual insurance: Buy your wife an individual health insurance policy through the Health Insurance Marketplace (aka Obamacare) until she turns 65. The Marketplace, as it stands now, offers comprehensive health coverage and they can’t deny her coverage or charge extra for preexisting health conditions.
And, if your income falls below the 400 percent poverty level – anything below $47,520 for an individual or $64,080 for a couple in 2017 – you may be eligible for a tax credit that will reduce the amount you’ll have to pay for a policy. To see how much you can save, see the subsidy calculator on the Kaiser Family Foundation website at KFF.org/interactive/subsidy-calculator.
To shop for marketplace plans in your state, visit Healthcare.gov or call their toll-free helpline at 800-318-2596.
If, however, your wife isn’t eligible for the government subsidy, or you want additional policy options to what the Marketplace offers, you can also buy health coverage outside the government marketplaces directly through a private insurance company, an online insurance seller, or an agent or broker. This option is not available if you live in Washington D.C. or Vermont.
These policies do not offer the federal tax credits, but they are required to offer the same menu of essential benefits as Marketplace policies do, and they can’t deny coverage or charge extra for preexisting health conditions. You might even find slightly lower premiums on outside policies, assuming that you don’t qualify for the tax credits.
To find a local broker or agent that sells insurance plans, check the National Association of Health Underwriters website (NAHU.org) which has an online directory. But keep in mind that agents won’t necessarily show you all available policies, just the ones from insurers they work with.
You can also look for these plans at insurance shopping sites like eHealthInsurance.com or GoHealth.com, which lists plans and providers that may not be listed on Healthcare.gov.
Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC Today show and author of “The Savvy Senior” book.