Part of planning for the future is to make sure that you don’t miss out on key dates that can cost you in the long term.
I know, you figured that when you made it to 62 or 65 or 67 that you would do something about Social Security, but you also knew that the longer you waited the higher the monthly benefit. Not so with Medicare. Because medical benefits are categorized as Part A, Part B, Part C and Part D, you need to know that your CalPers coverage changes because part of your benefit is now covered under Medicare.
So, Don’t forget to file for Medicare..
I checked in with a couple of wardens who have already reached that point in their life and here is their input. Thanks Greg Johnston and John Ewald.
Input from Greg:
Here is how Medicare and Social Security work for Safety employees that retire.
Under CalPers at age 65 a retiree must apply for Medicare. The retiree will be billed $95 a month in advance by Medicare. Cal Pers reimburses the retiree the $95 with his monthly warrant. Net cost is zero. However, if the retiree does not apply for Medicare on or before their 65th birthday, CalPers can cancel medical benefits. After the retiree has Medicare, Cal Pers provides supplemental health insurance. Medicare is hard pressed to cover 25% of any covered expense. Cal Pers supplemental covers what Medicare does not cover. Medicare has Part A , Part B, and Part D. Part A & B are the only parts to sign up for. Part D is for drugs. Cal Pers has much better coverage for drugs than Medicare.
If the retiree has worked enough social security quarters they can apply for social security benefits. The age for doing this is depends on how old the retiree is. I think 63.5 is the minimum age.
Update from John:
The fee is now $99 mo (but, since you get reimbursed, I suppose it doesn’t really matter)
Regarding the last paragraph, one can apply for and collect the eligible SS money, anytime after age 62, or between 62 and 66. The monthly benefit amount increases with each year you wait, but that amount is only a few dollars per -month – not significant. Generally everyone says its preferable to start getting the money at 62, rather than wait, because in a way, it’s sort of a gamble, that one will even reach age 67. Might as well have the money in your pocket, rather than theirs.
The quarterly statements that SS mails you show the monthly benefit amount, you are eligible for….but…since we also receive a government pension from PERS, we are only able to collect 1/3 of what that amount is. (for example, if the statement shows your eligible montly SS benefit amount is $900, when you do decide to apply and receive it, you will only receive $300 mo. But it’s still probably better to apply and start receiving it at age 62. That isn’t going to make a difference.
And when you begin receiving this SS benefit, by the way, will not effect your Medicare eligibility, early or otherwise, that age is still 65. Apply for it a few months early, I’m told it takes a couple months for them to process your application!