KFF Explains Whether Medicare Enrollees Can Switch to Marketplace Coverage and Give Up Medicare

A 70-year-old Medicare beneficiary asks whether it is possible to buy a health plan through the Marketplace and drop Medicare coverage.

If you already have Medicare, you should keep it. In fact, insurers that offer Marketplace plans are not allowed to sell those plans to people they know are covered by Medicare. And if you qualify for premium-free Medicare Part A, you cannot get the Marketplace premium tax credit to lower the cost of a Marketplace plan, even if your income would otherwise make you eligible.

Giving up Medicare can also create problems if you want to sign up again later. Re-enrollment is only allowed during the Medicare general enrollment period, which runs from January 1 to March 31, and coverage would not begin until the first day of the month after you enroll. For example, if you enrolled in January, your Medicare coverage would begin in February. You may also face late-enrollment penalties for Medicare Part B and Part D. If you do not sign up for Part B when you are first eligible, or if you drop it and re-enroll later, your monthly Part B premium may increase by 10% for each year you could have had Part B but did not. You could also owe a Part D late-enrollment penalty equal to 1% of the national average premium amount for every month you lacked coverage as good as the standard Part D benefit.

KFF also notes that Medicare beneficiaries with questions about changes to prescription drug costs or whether they need a drug plan even if they do not take medications should review related Medicare guidance.

While every effort has been made to provide accurate and current information in these FAQs, people should contact Medicare, Social Security, State Health Insurance Assistance Programs (SHIP), or companies offering Medicare Advantage, Medicare Part D plans, and Medigap policies directly for advice about individual situations.

Source: KFF