Opting Out of Medicare Part B

Part B Coverage Isn't for Everyone

Many people for one reason or another may decide to opt out of Medicare Part B. The reason most people opt out of Medicare Part B is because they have creditable coverage through another provider. This could be through an HSA Plan, through retirement benefits or through an employer's plan. Active Duty Tricare recipients are another group that often opts out of Medicare Part B.

Opting Out of Medicare Part B can have Advantages

Part B includes a monthly premium that is deducted from your Social Security check. Many people don't want to have this amount deducted from their check every month if they have creditable coverage through an alternative source. In addition, if you are opting out of Part B because you have creditable coverage through an alternative source (employment for example) you are also able to delay the start of other benefits such as supplemental insurance. By delaying these benefits using a Medicare approved reason you can save for years and then still sign up under Special Enrollment without incurring penalties.

Auntie Lou says, "Be careful about delaying anything. These programs and the benefits are headed downhill. Don't suppose because it's available now, that it will be in the future!"

Opting Out of Medicare Part B can have Disadvantages

Opting out of Medicare Part B without a "good" reason will lead to a 10% yearly penalty being added onto your premiums when you do finally sign up for Part B. This penalty amount is then added onto your premiums for the remaining duration of your Plan. The result can be very expensive premiums when you are least able to afford them.

How to Opt Out of Part B

When you turn 65 you should receive a Medicare card in the mail in addition to a "Welcome to Medicare" informational packet. Within this group of papers there is a form that you will need to fill out and send back to Medicare telling them that you want to opt out of Part B. Working People who haven't gotten a Medicare Card can contact Medicare directly at 1-800-medicare.