Your Important Role in Guiding Employees Through Medicare Options

Enrolling for Medicare is a complicated process for most Americans, but there are rewards to reap for employers who help their employees cut through the confusion.

Medicare’s annual enrollment period begins Oct. 15 and runs through Dec. 7. During this time span, individuals aged 65 and older can add, drop or switch their coverage, and address options such as supplemental Medigap plans, Medicare Advantage plans and Part D prescription drug plans.

The rules are complex and vary by individual situation, but total rewards (TR) professionals can provide general information about the different Medicare parts (i.e., A, B, C, D), explain how their employer-sponsored benefits interact with Medicare, and clarify enrollment timelines and potential penalties.

“Healthcare insurance is one of the most critical decisions for a retiree for the remainder of their life,” said Kevin Crain, the executive director of the International Retirement Income Council (IRIC), a nonprofit, membership-based consumer resource organization.

Access a bonus Workspan Daily Plus+ article on this subject:

• A Medicare Communication Resource: FAQs for Employees Nearing 65

A Chance to Mitigate Medicare Confusion

As shared at the start of this article, the Medicare system is layered and complex, with the base parts — plus Medigap and Medicare Advantage — all having different rules, costs and timelines. For example, employees can delay enrollment without penalty if they’re still covered by an employer, but they need to stop health savings account (HSA) contributions six months before enrollment.

This process is different than workplace healthcare enrollment, which has fewer election decisions, Crain said. For older workers, it also comes at a time when complex decisions may be more difficult to consider and make, he added.

“Confusion is increased by a flurry of communications that people receive close to their 65th birthday — and the communication is from trusted and non-trusted sources, which is hard for people to decipher,” Crain said.

But TR pros are often a known, trusted source. As such, it’s a position that offers a real opportunity to make Medicare education more effective, said Margaret Rutter, the managing director of employee experience at consulting firm WTW.

“Most people are used to learning about their health insurance through their employer, so when they approach retirement, or otherwise leave the company, and that support disappears, it can be unsettling,” she said. “TR teams can step in to fill that gap.”

Communicate Early and Often

Rutter and Crain agreed that employees shouldn’t just start hearing about Medicare when they turn 65.

“Ideally, employees should begin learning about Medicare well before retirement,” Crain said. “That gives them time to understand their options, coordinate coverage with a spouse if needed and plan for costs.”

A good communication plan builds in touchpoints over time, he added. The table below provides a sample plan.

“This phased approach helps employees build confidence instead of scrambling at the last minute,” Crain said. “There is a great future for the evolution of personalized digital tools, powered by artificial intelligence, to further personalize the communication and significantly scale access at a low cost.”

In such communication strategies, Rutter advised employers and their TR pros to consider ways to incorporate Medicare education into existing benefits education programs.

“Medicare rules require employers with more than 20 employees to treat Medicare-eligible employees the same as younger employees,” she said. “They cannot offer financial or other incentives to encourage enrollment in Medicare instead of the employer’s plan. Instead of broadly educating all employees approaching age 65, a more effective and compliant strategy is to integrate Medicare education into retirement planning and offboarding communications.”

Her other recommendations include:

• Incorporating Medicare education into retirement readiness programs, helping employees understand how Medicare fits into their post-employment health coverage.
• Providing clear offboarding materials that explain what happens to employer coverage at retirement and how to transition to Medicare.
• Hosting pre-retirement workshops or webinars that include Medicare basics, enrollment timelines, and how it interacts with continuation coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA) and/or any available retiree health benefits.
• Directing employees to trusted, neutral resources such as Medicare.gov (including its “Medicare & You” handbook) and Social Security offices for personalized guidance.
• Leveraging partners such as medical carriers, 401(k) administrators or independent vendors (e.g., Via Benefits) to support retirees in exploring supplemental coverage options (e.g., Medigap, Part D, Medicare Advantage) once they’ve enrolled in “Original Medicare.”

“By focusing on timely, relevant education, HR teams can stay compliant while still empowering their workforce with the information they need for a smooth transition into retirement,” Rutter said.

Enabling a Win-Win

The payoff of these efforts is twofold, Crain said.

For employees, it can mean peace of mind, better financial decisions and avoiding costly mistakes. For employers, it can reduce administrative headaches, avoid repeated one-off questions and strengthen employee trust.

“It will give employees comfort for one of the most important elements of their post-retirement life — healthcare access, coverage and what it will cost,” Crain said.

This increased comfort could result in direct healthcare savings for employers. Medicare becomes a payer for employees who enroll (and subsequently halt their HSA contributions and matches). And, some employees may find they can afford to retire earlier than expected.

“Investing in Medicare education isn’t just the right thing to do for employees; it also delivers real value back to the organization,” Rutter said. “When employees feel supported during this transition, it reflects positively on the employer and reinforces the message that the company cares about their well-being beyond their working years.”

Editor’s Note: Additional Content

For more information and resources related to this article, see the pages below, which offer quick access to all WorldatWork content on these topics:

• Employee Benefits
• Employee Experience
• Total Rewards
• Well-Being