Ask Ms. Medicare: Refusing Medicare Coverage Can Be Costly for Those on Disability Insurance Who Don’t Know the Rules

Q. I was granted Social Security disability (on appeal) in November 2008 and in February 2009 I received a letter saying I would receive Medicare Part A retroactively to 2006 and could have Part B as well. As I was already covered by my husband’s Tricare military health benefits, I declined Part B. But now Tricare says I must repay the money it spent on my extensive medical bills in 2006-08. Is this true? If so, we face bankruptcy.

A. Unfortunately, it is true. And anyone who qualifies for Social Security disability insurance benefits (SSDI)—especially in situations where Medicare coverage is granted retroactively—needs to be aware of the consequences of declining Part B enrollment if he or she already has any kind of employer health insurance.

If you qualify for Social Security disability soon after you first apply

In this situation, you do not get Medicare coverage immediately. Under current law, you must wait for 24 months after being approved for SSDI before Medicare health benefits under Part A (hospital coverage) and Part B (doctors’ visits and other outpatient services) can begin.

Once the 24 months have elapsed, you receive Part A automatically and get the option of enrolling in Part B. At this stage, if you already have health insurance from your own or your spouse’s employer, it is very important to contact the employer’s benefits administrators to find out what their policy is.

Some employer health plans (and Tricare is one of them) require enrollees who become entitled to Medicare—whether at age 65 or at an earlier age through disability—to enroll in Part B in order to remain eligible for the employer’s health benefits. If this is the case, Medicare becomes the primary coverage (meaning that Medicare pays claims first) and the employer plan becomes secondary. If the employer has fewer than 20 employees, Medicare usually becomes primary coverage automatically.

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