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Medicare and PEBB Program benefits
Learn about how your PEBB employee benefits work with Medicare.
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When you or your covered dependents become entitled to Medicare, either by age or disability, the member entitled to Medicare should contact Medicare to ask about the advantages of immediate or deferred enrollment in Medicare Part B when enrolled in coverage through employment. Medicare will not penalize you or your covered dependent for delaying enrollment in Medicare Part B when you are working and covered by employer-sponsored health care.
If you or your covered dependent are age 65 and enrolled in PEBB benefits through your employer, you or your covered dependent may choose to:
- Sign up for Medicare Part A at age 65 (if you are not enrolled in a CDHP) since most people do not pay a premium for Part A and Part A may help pay some costs not covered by your PEBB medical plan.
- Wait to sign up for Medicare Part B while covered by PEBB medical as an employee or dependent of an employee since there is a premium for Part B and Part B benefits may be of limited value while enrolled in a group medical plan. If you are not working more than 3 months after turning age 65, use caution and make sure you are aware of the initial enrollment timelines to enroll in Part B. The Medicare Initial Enrollment Period trumps any Special Enrollment Period.
- You(the employee) may waive PEBB employee medical benefits to enroll in Medicare instead.
To sign-up for Medicare Part A and Part B:
- Contact Social Security three months before you or your dependent turn age 65 (if you or your dependent worked for a railroad, contact Railroad Retirement Board to sign up).
- The initial enrollment is seven months. It begins three months before the month you or your dependent turn age 65, includes the month you or your dependent turn age 65, and ends three months after the month you or your dependent turn age 65.
- If you wait until the last four months of the initial enrollment period to sign up coverage will be delayed.
Entitlement to Medicare also qualifies as a special open enrollment event, allowing you to change your health plans. Reminder: If you are enrolled in a CDHP with an HSA and you or a covered dependent enroll in Medicare, you should change medical plans or you could face IRS penalties.
If you waive PEBB medical, you will remain enrolled in PEBB dental, basic life, basic AD&D, and basic long-term disability insurance. You can reenroll during the PEBB Program annual open enrollment for coverage effective January 1 of the following year or if you have a special open enrollment event that allows for the change.
If you or a covered dependent are enrolled in Medicare and PEBB employer-sponsored benefits, in most cases, PEBB medical plans provide primary coverage, and Medicare coverage is ordinarily secondary. PEBB coverage as the primary pays up to the limits of its coverage then Medicare as the secondary payer only pays if there are costs not covered by the primary payer that are within the Medicare-approved amounts.
There are circumstances where Medicare would be the primary payer even when you or your covered dependent are enrolled in employer-sponsored benefits. Review the Medicare and Other Health Benefits: Your Guide to Who Pays First for an explanation of those circumstances or contact your plan.
Note: Medicaid and TRICARE never pay first for services covered by Medicare. They only pay after employer group health plans and Medicare.
Medicare Part A – Hospital Insurance
- Helps cover inpatient care in hospitals
- Helps cover care in a skilled nursing facility, hospice, and home health care
- For most, there is no premium for Medicare Part A. Contact Medicare with questions
Medicare Part B – Medical Insurance
- Helps cover doctors’ and health care providers’ services, outpatient care, durable medical equipment, and home health care
- Helps cover some preventive services to help maintain your health and to keep certain illnesses from getting worse
- There is a premium for Medicare Part B based on income. Contact Medicare with questions
In most situations, employees and their spouses can defer Medicare Part B enrollment, without penalty, up to the date the employee terminates employment or retires. Contact your nearest Social Security office for information on deferring or reinstating Medicare Part B. If your entitlement is due to a disability, contact a Social Security office regarding deferred enrollment.
Medicare Part C – Medicare Advantage
- Medicare-approved private insurance plans
- Most Medicare Advantage plans cover Medicare prescription drug coverage (Medicare Part D)
- Some Medicare Advantage plans include additional benefits
- Medicare Advantage plans manage most of the claims
- There is a premium for most Medicare Advantage plans
Medicare Part D – Prescription Drug Coverage
- Helps cover the cost of outpatient prescription drugs
- May help lower your prescription drug costs and help protect against higher costs
- Part D plans are run by Medicare-approved private insurance companies
- There is a premium for Medicare Part D
Medicare Part D is available to people enrolled in Medicare Part A and/or Part B. It is a voluntary program that offers prescription-drug benefits through private plans. These plans provide at least a standard level of coverage set by Medicare.
All PEBB medical plans available to employees provide creditable prescription drug coverage. This means the plans provide prescription drug benefits that are as good as or better than Medicare Part D coverage. After you become entitled to Medicare Part A and/or Part B, you can keep your PEBB coverage and not pay a late enrollment penalty if you decide to enroll in a Medicare Part D plan later. (To avoid a premium penalty, you cannot be without creditable drug coverage for more than two months.)
If you do enroll in Medicare Part D, your PEBB medical plan may not coordinate prescription-drug benefits with your Medicare Part D plan. If you enroll or cancel enrollment in Medicare Part D, you may need a “notice of creditable coverage” to prove continuous prescription-drug coverage. Call PEBB at 1-800-200-1004 to request one.
Note: If you choose to enroll in PEBB retiree insurance coverage and also enroll in Medicare Part D, you may only enroll in Premera Blue Cross Medicare Supplement Plan G. The PEBB Program does not offer a Medicare Part D plan and you are not required to enroll in it.
Medicare Supplement plans are not available to employees. A Medicare supplement plan, or Medigap plan, can help pay for some of the health care costs that Medicare Part A and B don’t cover, such as copayments, coinsurance and deductibles.
Each Medicare supplement plan is identified by a letter A through N. All plans offer the same basic benefits and some offer additional benefits.
Medicare Supplement plans do not offer prescription drug coverage, so you will also need to purchase a Part D Medicare prescription drug plan on the open market as the PEBB Program does not offer a Part D plan.
You may choose to purchase a Medicare supplement plan from a private insurance company or enroll in the supplement plan the PEBB Program offers, if eligible for PEBB retiree insurance coverage. The PEBB Program offers Premera Blue Cross Medicare Supplement Plan G. There is no prescription drug coverage with this plan. If you select this plan, you may have to enroll in a Medicare Part D plan to get your prescriptions, unless you have other creditable prescription drug coverage (e.g., VA).
Please contact Medicare for coverage questions as Medicare is primary payer. Premera Blue Cross Medicare Supplement Plans only pay when Medicare pays for services billed under Part A and Part B.
If you are enrolled in a consumer-directed health plan (CDHP) with a health savings account (HSA) and you become eligible for Medicare Part A or Part B during the year you should change to another PEBB medical plan that is not a CDHP or you could be subject to IRS tax penalties. The PEBB Program should receive your enrollment/change form requesting the change 30 days before the Medicare enrollment date, but must receive it no later than 60 days after the Medicare enrollment date.
For general or claim specific information about Medicare.
Phone: 1-800-MEDICARE (1-800-633-4227)
- Social Security Administration
For information on Medicare Part A or B eligibility, entitlement, and enrollment; replacement Medicare cards; change of name or address; premium questions; and to report a death.
- Statewide Health Insurance Benefits Advisors (SHIBA)
Through the Washington State Office of the Insurance Commissioner, SHIBA provides free, unbiased and confidential one-on-one help with your Medicare options and questions.