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Can I Keep My Marketplace Insurance If I Enroll In Medicare?

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We have received a bunch of questions about enrolling in Medicare lately. Here are answers to two that came up recently.

My wife has been automatically re-enrolled in a silver policy on the Oklahoma health insurance marketplace. She will turn 65 and be enrolled in Medicare on May 1, 2015. Can she keep her silver policy when she is enrolled in Medicare? And, if she does, will she automatically lose her premium subsidy? Do we have to cancel the policy or will the insurer do it automatically?

Your wife doesn't have to give up her marketplace policy when she turns 65, but financially it probably doesn't make sense to keep it, says Tricia Neuman, director of the program on Medicare policy at the Kaiser Family Foundation (KHN is an editorially independent program of the foundation.)

Once she's eligible for Medicare, your wife will no longer qualify for premium tax credits on the marketplace, making that coverage more expensive.

In addition, she may face higher Medicare premiums if she doesn't enroll in that coverage once she becomes eligible. "Those who delay could face a lifetime premium penalty for late enrollment," Neuman says.

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The penalty could be 10 percent for every year she delays enrolling in Medicare Part B, which covers outpatient services, and 1 percent for every month she delays enrolling in Part D, which covers prescription drugs.

Recently, my mother changed her primary residence from Illinois to Florida. She didn't realize that her Medicare prescription drug plan insurer would disenroll her as a result. Though I was able to find a new plan for her that will take effect Jan. 1, we have had to pay full fare for the prescription drugs for the final months leading up to the new plan year. Many people initiate Part D drug plans when they first turn 65. In their late 80s, how many will remember the rules?

It's certainly possible that your mother's drug plan doesn't provide coverage in both states. Although some Medicare prescription drug plans are available in all 50 states, others cover a more limited geographic area.

But your mother shouldn't have to wait until January to enroll in a new plan. Moving out of a drug plan's service area creates a three-month special enrollment period when she can sign up for a new plan near her new home.

"Try contacting the local [state health insurance assistance program] for one-on-one counseling," says Jack Hoadley, a research professor at Georgetown University's Health Policy Institute. You can locate your local program by searching this website.

Yes, it seems plausible that many people are unlikely to remember plan rules 15 years after they sign up. But that's all the more reason for people to review their plan options during open enrollment rather than simply renewing their existing plan.

"Plans change from one year to the next, and so do the needs of consumers," Neuman says.