Hi Toni:
I attended one of your seminars and now I need help with my Medicare/Social Security issue.
I am 65 almost 66, “still working” and covered entirely by my company with an HSA insurance plan. I put about $5,000 per year into a tax sheltered account for medical expenses.
When I went to the SS office to tell them this, they convinced me to sign up for Medicare Part A (hospital) although I really did not need it. Now I find out that since my insurance is an HSA, signing up for Part A may disqualify me for the tax free savings plan.
1. Does having Part A really disqualify me from contributing the $5000 to my HSA Plan?
2. Should I go to the SS office and stop Medicare part A?
3. Will this hurt me in any way – can I get back into Part A when I retire?
Thanks, John from West U area
Hello John:
Here is the rule about Medicare Part A and making contribution to a HSA. Social Security informed me that….Medicare Part A begins when Social Security knows you have turned 65 not Medicare. I would advise you or anyone who wants to delay their Medicare that they must be working full time as an employee not self-employed or a contracted worker and be covered under a group health plan based on current employment not an individual health plan.
Below are the answers to your questions:
- Yes enrolling in Medicare Part A may disqualify you from contributing the $5000 to your HSA. Always talk with your HR department, contact your insurance company when you are contemplating what to do with your Medicare coverage if it is different that the norm or you can always contact me at www.Tonisays.com/ask-toni and together we can explore all of your options.
- Answering question #2 about stopping your Medicare Part A. I would call Social Security at 1/800-772-1213 explain to the agent how you were misinformed since you have been enrolled and funded your HSA before you turned 65 and now you cannot contribute to the plan. Ask if you can appeal what was advised to you and want can schedule an appointment with your local office.
- When you call Social Security to schedule an appointment ask them what type of problems you would have to getting back into Part A at a later date. This is the first I have heard of someone wanting to stop their Part A; I’ve seen many who have stopped Medicare Part B(Medical) when they have returned to work with group health insurance.
For those who need to delay Medicare Part A due to “still working fulltime” with company health insurance and want to continue making contributions to a HSA can do so by simply not informing Social Security that you have turned 65.
When you do contact Social Security to begin receiving your Social Security check or to enroll in Medicare Part A and/or Part B, it is then that you cannot make any more contributions to the HSA because you will be in Medicare. Your Medicare Part A and/or Part B dates will be later than when you turned 65 and you will need a SEP (Special Election Period) because you are covered under group health plan based on current employment.
*I can say that it makes me uneasy to advise someone not to enroll in Medicare Part A when turning 65, but I understand wanting to maximize your retirement income with a HSA.
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Toni King, author of the new Medicare Survival Guide®, which is a simple guide explaining Medicare is on sale at www.tonisays.com. Email questions to www.tonisays.com/ask-toni or call 832/519-TONI (8664).
