How To Cancel Medicare - Disenrolling From Parts A & B
If you’re part of the majority of Americans, chances are you’ll automatically be enrolled in Medicare when you become eligible. While convenient, automatic enrollment proves to have some drawbacks, especially for those who prefer getting their health insurance elsewhere. Luckily, there is a way for you to cancel your Medicare, but make sure you weigh your options carefully before disenrolling from both Parts A and B.
How To Cancel Your Medicare
When you decide to cancel Medicare there some things you need to know. For example, you must opt out of Part A and Part B individually. So where do you begin?
First, you need to find the social security office in your area so you can speak to a Social Security agent in person. You can call Social Security to speak to an agent, but you can't cancel over the phone. They will explain to you the consequences and process of canceling your Medicare benefits, and send you the correct form to disenroll.
When you go to the Social Security office to cancel your benefits, you will speak to a Social Security Adviser. If you are certain you want to cancel, after the representative has explained the consequences of disenrolling from Medicare, they will help you fill out the necessary form.
When you have submitted the form to the Social Security office, they will send you a letter. This letter will again explain the consequences of withdrawing from Medicare Part B. Your disenrollment will be effective at the end of the month that you filed the CMS 1763 form.
The form is not available online. You can contact the Social Security Administration at, 1-800-772-1213 and for TTY at 1-800-325-0778. Now that you know how to cancel Medicare, it is time to consider if you should cancel.
Cancel Medicare Part A
You can’t cancel Medicare Part A if you’re receiving Social Security. However, if you choose to stop your social security benefits, then you would stop receiving Medicare benefits. You need to know that if you stop your social security benefits, then you will have to repay the money you have already received. If you still think Part A isn’t for you, you can cancel at any time by using the disenrollment form CMS 1763. It’s also important to note that you can re-enroll at any time.
Cancel Medicare Part B
If you want to cancel Medicare Part B, you will still have to use the disenrollment form CMS 1763. When you fill out this form you will select what Medicare Part you are canceling and explain why you are choosing to cancel. If you do not cancel Medicare Part B before you turn 65, the premiums may automatically be deducted from your Social Security check.
What Happens When You Disenroll?
There are consequences if you disenroll from Medicare. If you cancel Medicare Part A, you may be penalized. If you can receive Part A without paying premiums, there is no late penalty for canceling. However, you will have late penalties if you can buy into Medicare Part A and cancel.
If you cancel Medicare Part B, you are responsible for the cost of out-of-hospital healthcare costs. You can re-enroll during the open enrollment period for Part A and Part B. Open enrollment is the first quarter of every year. You will receive a penalty for late enrollment. The penalty is for each year you were out of the Medicare Part B program. You will pay this as long as you have Part B.
Why You Would Want To Disenroll
There are very little reasons to cancel Medicare Part A. However, if you continue to work while enrolled in Medicare, and are contributing to your health savings account funded by pre-tax dollars, then you should disenroll from Medicare Part A.
You may want to cancel Part B coverage, and usually, the cost is the primary reason. When you are enrolled in Medicare Part B, you must pay a monthly premium. You may choose to disenroll from Part B if you are covered under an employer group plan.
Finding New Health Coverage
Medicare is designed to become your insurance provider when you retire. If you are trying to find new health coverage, you need to be aware of the rules.
For Medicare beneficiaries your only option is an employer plan. That's because it is illegal for someone to sell you an individual health plan if you are already receiving Medicare benefits. This rule also applies to an individual market policy outside the health insurance marketplace. If you, or your spouse, are still working, then you may purchase a plan under the Small Business Health Options Program Marketplace.