Q: Can Medicare Part A Be Canceled, Waived or Deferred?
Asked by Anonymous on May 22, 2018
Medicare Part A is the part of Medicare that covers inpatient hospital benefits, skilled nursing facility care, hospice care, and home health care. For most people, there is no premium associated with Medicare Part A, and you are automatically enrolled in Part A upon reaching age 65 or through Medicare disability. For this reason, since there is not a premium for it, there is not typically a justification for cancelling or waiving Part A.
That said, you do have the option of not participating in Medicare Part A if you don’t want to do so. There is no penalty for choosing this as long as you are covered by other coverage, such as coverage through an employer or former employer. However, it is important to note that Medicare and Social Security are connected. So, if you waive Part A, you also cannot participate in Social Security, and if you have already received Social Security benefits, you will have to re-pay any benefits you have already received.
Who May Want to Consider Cancelling or Waiving Medicare Part A?
There are some unique situations which may cause you to consider cancelling or waiving Medicare Part A, including:
- You are not entitled to premium-free Part A – If you have not qualified for premium-free Part A through you or your spouse’s payroll taxes (40 quarters total), you will have to pay a premium for Medicare Part A. In this case, if you are covered by other insurance, you may elect to delay or waive Part A. It is important to note, however, that doing so may cause a delay and late enrollment penalty at a later time when you do enroll in Part A.
- You have a high-deductible health plan and an Health Savings Account (HSA) from an employer with more than 20 employees – If you are in a high-deductible health plan and have an HSA, you may elect to delay, cancel or waive Part A. Enrollment into any part of Medicare, including Part A, prohibits you from continuing to contribute to your HSA.
What About Medicare Part B?
Medicare Part B DOES have a premium ($144.60 for 2020, an increase of $9.10 from $135.50 in 2019). Therefore, choosing whether to delay enrollment into Part B is the more pertinent question for most people. Medicare does have late enrollment penalties that apply if you are not currently covered by a credible group health plan, so you should make yourself aware of those penalties before making this decision.
However, if you do have group coverage that is primary to Medicare (more than 20 employees), delaying Medicare Part B may make sense, and you will be exempt from the Medicare late enrollment penalty for Part B as long as you start Part B within 8 months of losing that group coverage.