Don't Sever Your Medicare Coverage With A Severance Package
A severance package is a bundle of benefits offered to employees who lose their jobs, due to termination, lay off or buy out. It often includes financial compensation, and continuation of some benefits, such as health insurance, for a certain period of time. The big question for those who accept this package: Must I enroll in Medicare? The answer is fairly straight forward but often difficult to understand or implement.
The first opportunity to enroll in Medicare for most people is at age 65, during the Initial Enrollment Period. However, those who are still working and have an employer group health plan can delay enrollment if they qualify for a Part B Special Enrollment Period (SEP). This is an eight-month window for enrolling without penalty or delay. This SEP has two important criteria that create confusion when a severance package appears.
1. The group health plan is based on the current employment of the individual or spouse.
The italicized words are the ones that tend to create confusion. Current employment means working as an employee, not just working and collecting a paycheck.
I spoke to a 69-year-old man whose status was changing. He was going to continue doing the same work and have the same health coverage but, next month, he would become an independent contractor. HR and insurance representatives said it was legal for him to have the coverage. And because he would still be working, he believed he does not need Medicare now.
The legality of the coverage is not the issue; it is his employment status. An independent contractor is considered self-employed; he does not have an employer. So, the health plan is not based on his current employment (it is just a benefit) and he needs to enroll in Medicare now.
2. The eight-month window begins with the first day of the month after the last day of employment or coverage, whichever comes first.
A recent client had a buyout of his company shares in November 2024. His severance package included 12 months of insurance and a paycheck every two weeks – same deal he had as a shareholder of the company. His financial advisor recommended he start checking out coverage for December 2025. He didn't feel any urgency but his advisor said the process takes some time. He made an appointment for July 25.
He now realizes how lucky he was. His employment ended November 30 and his Part B SEP began the next day. His Part B enrollment deadline was July 31. He had only six days to submit his application. If he had waited until his coverage ended in November, he would have missed his window and could not enroll until the General Enrollment Period in January. He would have had at least a two-month gap in coverage.
One Tip to Avoid Trouble
Want to prevent problems when continuing with a severance package after age 65? Sign up for Part B so it takes effect as soon as the employment ends – no matter how long you continue to work or when the severance package benefits end.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
5 minutes ago
- Yahoo
Childhood vaccination rates fall for 5th straight year, CDC data shows
Childhood vaccination rates for the 2024-25 school year fell for the fifth year in a row, according to data from the Centers for Disease Control and Prevention (CDC) published Thursday. Vaccine coverage for shots that protect against measles, polio, chickenpox, whooping cough and hepatitis B have now been under 95% -- a threshold many experts consider herd immunity -- since at least the 2020-2021 school year. Exemptions for vaccines also hit a record high, increasing to 3.6% for the 2024-25 school year compared to 3.3% during the previous school year. The number of kindergarteners exempt from one or more vaccines was about 138,000. MORE: Members of CDC vaccine panel ousted by RFK Jr. say committee has 'lost credibility' "That gap, combined with concentrated pockets of exemptions, is exactly how sustained outbreaks gain a foothold," said Dr. John Brownstein, an epidemiologist and ABC News medical contributor. "Kindergarten vaccination rates are an early warning indicator. Persistent declines predict conditions for more frequent and larger outbreaks are already in place." Exemptions increased in 36 states, with 17 states reporting exemption rates exceeding 5%, according to the CDC data. Nearly all the exemptions were listed as non-medical, typically related to religious or personal reasons. "The surge in non-medical exemptions reflects a growing influence of misinformation and shifting policy. When these beliefs concentrate geographically, they erode the very network of immunity that protects all children," Brownstein said. An estimated 92.5% of kindergarteners were vaccinated with the polio vaccine as well as the measles, mumps and rubella vaccine, leaving an estimated 286,000 vulnerable to the diseases. It comes as the U.S. is seeing the highest number of measles cases since 1992, with dozens of outbreaks reported across the country, CDC data shows. About 94% of kindergartners were vaccinated against hepatitis B. Even fewer children were vaccinated against chickenpox and whooping cough with rates at 92.1%, according to the data. MORE: Medical groups sue HHS, RFK Jr. over 'unlawful' vaccine changes Last year saw a record level of whooping cough cases, with more than 35,000 cases reported -- roughly six times as many cases compared to 2023. Federal health officials in the Trump administration have also recently shifted messaging around vaccination, now pushing for personal choice -- advocating that parents should decide whether or not to immunize their kids. "Public health messaging has shifted in ways that place personal choice ahead of community protection. When federal leadership softens its stance on vaccination, it can accelerate hesitancy and legitimize non medical exemptions, further weakening population level immunity," Brownstein said. "As pediatricians, we know that immunizing children helps them stay healthy, and when everyone can be immunized, it's harder for diseases to spread in our communities," Dr. Susan Kressly, president of the American Academy of Pediatrics said in a statement. "By making sure all children can access immunizations before entering school with their classmates, children are best able to stay healthy to play, learn, and grow."
Yahoo
5 minutes ago
- Yahoo
Hunger strike at Alligator Alcatraz reaches Day 9 as inmate protests conditions
A detainee at the Florida immigration detention center known as Alligator Alcatraz has been on hunger strike for at least nine days, the latest in a string of detainees to allege being mistreated at the prison in the Everglades. 'Since my life no longer belongs to me, it's up to them to decide whether I live or die,' detainee Pedro Lorenzo Concepción, 44, told El País from inside the facility. State officials run the Florida detention camp, housing migrants in a series of hastily assembled tents and chain link enclosures on a converted airstrip as they await federal immigration court and potential deportation by U.S. Immigration and Customs Enforcement. The Independent has contacted the Florida Division of Emergency Management, one of the state agencies overseeing the facility, for comment. Concepción, who came to the U.S. from Cuba in 2006 but lost his permanent resident status after going to prison, has been in detention since being arrested on July 8 after a check-in at a Florida Immigration and Customs Enforcement office, according to his family. The Independent has contacted ICE for comment. On July 22, he went on hunger strike and has collapsed multiple times inside Alligator Alcatraz. During the strike, he was taken to Miami's Kendall Hospital, according to his family, where he said he sat in handcuffs as doctors tried to get him to eat, but he refused. 'I don't want food, I refuse any treatment,' reads a document he signed about his protest, obtained by El País. 'I didn't even ask to be taken to the hospital, because I'm fighting for my family and all Cubans, and I belong where my people are, in prison, suffering the same hardship they are.' The Independent has contacted Kendall Hospital for comment. Concepción's wife said she's worried he could be deported back to Cuba without her or the couple's two children. 'In a minute, your life falls apart,' she told the paper. 'It's been 19 years of being together.' Concepción, who said he was shackled and left on a floor at Alligator Alcatraz for more than 10 hours upon his arrival, is not the only one to complain of alleged poor conditions at the facility, which federal officials say they plan to support with millions in reimbursement funds and use as a model for future detention centers. Other inmates say they have faced poor sanitation and other brutal conditions inside the facility, which sits in the middle of a sweltering swamp. 'They only brought a meal once a day and it has maggots,' Leamsy 'La Figura' Izquierdo, a Cuban artist who was housed at the facility, told CBS News. 'They never take of the lights for 24 hours. The mosquitoes are as big as elephants.' The facility is facing lawsuits on environmental and civil rights grounds, with lawyers accusing officials of largely barring them from being able to speak with detainees. Deportation flights for detainees held at the facility have begun, state officials announced last week. Earlier this month, Florida news outlets found that among those held at Alligator Alcatraz, only about one-third had a past criminal record, despite officials touting the prison as being designed to hold the worst of the worst.
Medscape
6 minutes ago
- Medscape
Think of Exercise as a Vaccine for Your Body
This transcript has been edited for clarity. Let's talk today about how exercise can be viewed as a type of vaccine. With a traditional vaccine, there is a controlled exposure to something harmful, which is typically a viral particle. That exposure, though, allows the immune system to be prepared to deal with that virus if it sees it again later on. Exercise also has the appearance of harm on the surface. It doesn't always feel good in the moment. The whole body is working harder to meet the demands of the exercise. As a result of that extra stress during the exercise activity, the body is then better prepared to deal with stress that can occur from disease processes later on. As a result of the aging process,organ systems are going to decline a little bit in function, and exercise is the best way to combat those declines. Let's think about something like pneumonia, where somebody might have a fever; they're going to be breathing heavy, and their heart's going to be working harder. For someone who's been exercising on a regular basis, their organ systems are better prepared to meet the higher demands associated with a disease process such as pneumonia. In contrast, for someone who has not been exercising frequently, their organ systems have declined in function, and then as a result, they're more likely to be overwhelmed during the disease process. Someone might need medications to support their blood pressure during a pneumonia situation. Someone else might need a mechanical ventilator. In this way, you could view exercise as training for the worst day of your life from a medical perspective. You want to make sure your organs are equipped to deal with stress when it's occurring in an uncontrolled environment, like from an infection such as pneumonia. Vaccines may be a controversial topic for some, but I think exercise is one type of vaccine whose benefits we can all agree upon.
