How to Advise Medicare-eligible Employees working past 65
For many seasoned insurance agents, selling Medicare has been straightforward. Target individuals turning 65 and offer a helping hand. But what happens when those individuals increasingly choose to delay retirement and continue working? As more seniors continue to push back retirement, many independent insurance agents have had to adapt to their changing needs. According to The Bureau of Labor Statistics, by 2024 individuals 65 years and older will account for over 21% of the workforce. That’s nearly double what it was 30 years ago. The facts speak for themselves. Seniors are working well past their Medicare eligibility age. So how do you advise Medicare-eligible employees working past 65? Keep reading to find out.
Why are Seniors Delaying Retirement?
Before we dive into strategy, let’s first take a look at why so many seniors are choosing to delay retirement:
To receive maximum Social Security benefits.
65 is no longer the full-benefit retirement age for social security. According to the National Academy of Social Insurance, “ the full benefit age is 66 years and 2 months for people born in 1955, and it will gradually rise to 67 for those born in 1960 or later.” Those who wait until the latest claiming age of 70 will receive 132% of what they would’ve at the normal retirement age. The total amount received in benefits will be the same regardless of the age it was collected, but monthly benefits will be larger if delayed.
Lack of retirement savings
Another common reason seniors are choosing to delay retirement is because of the lack of retirement savings. According to a Vanguard study, the median 401(k) account value for a person aged 65 is $22,217. Seniors are not saving as much as they used to. This can be for various reasons such as lack of pensions, unexpected life expenses, etc.
Not ready to leave the workforce
Some seniors are just not ready to leave the workforce. Many have worked for decades building a business or status in their workplace and are just not ready to say goodbye to that. Older seniors are healthier than they’ve ever been and working provides meaning and purpose for them.
Understanding the reasons why many seniors are choosing to delay retirement can be helpful while interacting with these types of clients. If you know a client is working past 65 because they don’t have enough saved, you can offer them options that are affordable or provide resources for extra help.
Now that we’ve discussed the reasons seniors are working past 65, let’s talk about how to advise these types of clients.
Gather Necessary Information
Just like any other sales call or meeting regarding Medicare you want to collect as much relevant information as possible from your client. On top of the standard data collection, ask your client’s working past 65 questions like these:
- When are you hoping to retire?
- How many employees does your company have?
- Are you happy with your current employer health coverage?
- What are your premium, copays, coinsurance, deductible, and out-of-pocket costs?
Once you’ve collected all the necessary information, it’s time to lay out their options for Medicare coverage while working. Seniors working past 65 typically have the following options:
- Drop their employer health coverage and enroll in Medicare
- Delay Medicare enrollment and keep employer health coverage
- Keep employer health coverage and delay enrolling in Medicare Part B
If your client’s company has fewer than 20 employees, it might be wise for them to enroll in Medicare when they are eligible. Some smaller employers may no longer offer health coverage once an employee is eligible for Medicare.
Explain How Medicare works with Current Insurance
Depending on your client’s specific situation, they may choose to enroll in Medicare (or at least Part A) and keep their employer coverage. Explain how Medicare works with their current insurance. Depending on the type of insurance your client has, Medicare will act as either the primary or secondary payer. This can be beneficial to clients that don’t have the best employer health coverage. This is also a great opportunity to point out the benefits of enrolling in Part A while still working.
Explain How to Sign up or Delay Enrollment
Signing up or delaying Medicare while still working can be very confusing for some clients. Guide them through the process. Explain their Medicare coverage will not be delayed or started automatically and that they will need to contact their local social security office to complete the process. It is also very common for seniors to receive a Medicare card in the mail, explain to your clients if they receive a Medicare card and do not wish to enroll in Medicare they will need to follow the instructions for sending back their Medicare card.
Discuss Enrollment Periods and Late Enrollment Penalties
Make sure you communicate the various enrollment periods to your clients. If they choose to enroll, they will need to do so during their initial enrollment period. If they choose to delay, they will need to do so during a special enrollment period. Make sure you communicate the dates and requirements for each specific enrollment period. You will also need to alert your clients of late enrollment penalties and how they can avoid them.
Offer Services to help transition to Medicare
Last but certainly not least, offer your services to help them navigate the Medicare process. Even if a client decides to delay enrollment they will eventually need to enroll. Stay top of mind by reaching out to those clients periodically. Send them relevant Medicare information like changes to Medicare, enrollment period information, or connect with them on social media. By providing relevant information and staying top of mind they will be more likely to solicit your services in the future.