Many baby boomers may be considering the idea of early retirement and for some in this age group, a lifetime of working means a good pension and benefits after they leave the day-to-day grind.
But more and more companies are converting, scaling back or eliminating retirement benefits, leaving the boomer generation in the precarious position of finding alternative health insurance coverage until they are eligible for Medicare at age 65.
To help, the Office of Financial and Insurance Regulation (OFIR) offered a number of tips for Michigan consumers considering retirement health insurance options.
"Finding a way to bridge the gap between early retirement and Medicare can be a difficult challenge for many Michigan boomers leaving with workforce," OFIR Commissioner Kevin Clinton said. "It's important to understand where to look and what to consider before you make this important decision."
If your employer is not offering to extend health insurance coverage beyond your retirement date, here are a few options for finding continuing coverage:
- Spouse's Policy: If your spouse is still employed and has access to benefits, see if you can be added to the policy. While your spouse may have to pay more for the coverage, this is likely your most affordable option.
- COBRA: The federal (www.dol.gov/dol/topic/health-plans/cobra.htm) Consolidated Omnibus Budget Reconciliation Act (COBRA) allows terminated employees and their dependents who may lose group health care coverage because of termination of employment, death, divorce, or other life events to continue the group coverage for specified periods of time usually 18, 29 or 36 months. The eligible person must pay the premium for this continuation of coverage.
- Military: If you are a retired military veteran, you may be eligible to join the Defense Department's Tricare plan. Read more about who is eligible for Tricare and the coverage offered at www.tricare.mil/mybenefit/home/overview/Eligibility/WhoIsEligible/RetiredServiceMembersAndFamilies.
- Individual Coverage: These plans may be expensive, especially if you are on medications or have a chronic health condition. In some cases pre-existing conditions may make it difficult to find coverage, but Blue Cross Blue Shield of Michigan, the state's insurer of last resort, must provide coverage to all Michigan residents regardless of any pre-existing conditions.
OFIR's health insurance page at www.michigan.gov/healthinsurance has information to help you shop around and learn more about the different types of policies available to consumers, certain minimum coverage requirements and explanations of many key terms.
- Michigan's High Risk Pool: Under the federal Affordable Care Act, a temporary pool was created to help adults with pre-existing conditions find individual coverage. The Health Insurance Program for Michigan (HIP Michigan) is administered by mid-Michigan HMO Physicians Health Plan and provides health insurance for people who are otherwise unable to purchase coverage due to pre-existing conditions. The pool will expire in 2014 when insurers will not be allowed to deny coverage based upon your health status.
To qualify for the HIP MICHIGAN you must:
- Be a resident of Michigan or lawfully present in the United States.
- Have a documented medical condition present within the last 12 months or have been denied coverage due to health conditions.
- Have been uninsured for 6 months prior to submitting your application.
For further questions on HIP MICHIGAN, call 877-459-3113.