Some job-based insurance plans offer creditable drug coverage. If you are eligible for Medicare and enrolled in creditable coverage from your current employer, you can delay Part D enrollment without incurring a late enrollment penalty (LEP). When you decide to enroll in Part D, you will have a two-month Special Enrollment Period (SEP) Special Enrollment Periods (SEPs) are periods of time outside normal enrollment periods when you can enroll in Medicare or change your health and/or drug coverage. One example is the Part B SEP, which allows you to enroll in Part B without penalty while you have job-based insurance and for eight months after you lose the insurance or stop working. SEPs triggered by specific circumstances may also allow you to switch or disenroll from Part D and Medicare Advantage Plans. For example, if you moved out of your plan’s service area, you would receive an SEP to switch to another plan. .
Even if your drug coverage is not creditable, you may want to keep it as a form of secondary insurance Secondary insurance is health insurance that pays after primary insurance on a claim for medical or hospital care. It usually pays for some or all of the costs left after the primary insurer has paid (e.g., deductibles, copayments, coinsurances). If your primary insurance denies coverage, or if you do not have primary insurance, your secondary insurance may make little or no payment for your health care costs. See also: Primary Insurance. , and enroll in a Part D plan as primary insurance Primary insurance is health insurance that pays first on a claim for medical and hospital care. In most cases, Medicare is your primary insurer. See also: Secondary Insurance. . Having secondary insurance may help lower the cost of Part D-covered drugs when you are in the coverage gap (donut hole). Contact your plan to learn whether it coordinates with Part D coverage. You should also consider whether the cost of your monthly premium for the plan is offset by the coverage it provides, or whether you are better off disenrolling and only keeping Part D.
In some plans, you cannot drop drug coverage without losing your health benefits or vice versa. Also keep in mind that your spouse or dependents are not eligible to use your Medicare coverage and may need other insurance if you drop your job-based insurance. Contact your benefits administrator to learn more about your job-based insurance before making Part D enrollment decisions.
If your drug coverage from current employment is not creditable, you can still delay enrollment into Part D. You will have the previously mentioned two-month SEP to enroll in a Part D plan. However, this SEP does not eliminate the Part D LEP. To avoid the LEP, you need to enroll in Part D when you are first eligible.