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Navigating The Ever-Changing and Complex World Of Medicare: 

Guardian Rock Wealth ™ has Agents to Explain and Guide you Through the Process

The following is not meant to be comprehensive; it is merely a guide with general information that may answer many of your questions before meeting with a qualified Medicare agent.  

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Medicare is a federal health insurance program for people aged 65 or older, certain younger people with disabilities, and people with End-Stage Renal Disease (permanent kidney failure requiring dialysis or a transplant). Understanding its intricacies is fundamental for comprehensive wealth management and maintaining financial freedom. Many government-required protocols must be followed before, during, and after the Medicare enrollment process.

Many individuals and advisors neglect to consider the significant costs of healthcare in retirement and how to mitigate those costs. For High-Net-Worth Individuals the cost of Medicare can be significant but it does not have to be if you plan well in advance. 

Healthcare Expenses can Derail Financial Plans Quickly

By carefully planning and understanding your options, often with the guidance of expert financial advisory services and licensed Medicare agents, you can make sure you have a seamless transition to Medicare and maintain comprehensive health coverage, contributing to your overall wealth management plan and financial freedom.

Confused About Medicare Enrollment? Let Christine Help!

Medicare enrollment can be overwhelming and difficult to navigate. With so many plans tailored to unique circumstances, it’s easy to feel unsure about which option is right for you. Christine is here to simplify the process and answer all your questions. Reach out today and get expert guidance on finding the Medicare plan that fits your needs!"

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When Should I Defer Part B? A Strategic Decision for High Net Worth Individuals

Deferring Medicare Part B (Medical Insurance) can be a strategic financial decision, particularly for high earners and high net worth individuals focused on optimizing their wealth management strategy and achieving tax efficiency. However, it's crucial to understand the rules to avoid late enrollment penalties. Generally, you should only consider deferring Part B if you have creditable coverage through current employment.

When Deferring Part B is Advisable for Smart Portfolio Management:

Group Health Plan through Current Employment: If you or your spouse are still actively working and covered by a group health plan through that employment, and the employer has 20 or more employees, you can typically defer Part B without penalty. In this scenario, your employer's group health plan is usually the primary payer, and Medicare would be secondary. Delaying Part B can save you the monthly premiums so it is an important consideration.

When Deferring Part B is NOT Advisable (And may lead to penalties):

  • Small Employer Group Health Plan:  If your employer has fewer than 20 employees, Medicare generally becomes your primary insurance once you're eligible. In this case, delaying Part B will likely result in late enrollment penalties and gaps in coverage.

  • COBRA Coverage: COBRA is not considered creditable coverage for deferring Part B without penalty. If you are on COBRA, you should enroll in Medicare Part B during your Initial Enrollment Period or a Special Enrollment Period if you qualify.

  • Retiree Health Plans: Retiree health plans are generally not considered creditable coverage for deferring Part B without penalty. You should enroll in Part B when you are first eligible.

  • VA Benefits: While VA benefits provide excellent healthcare, they are not considered creditable coverage for deferring Medicare Part B. You should enroll in Part B when you are first eligible to avoid penalties and consider specialized Medicare Advantage plans for your situation. Contact a Guardian Rock Wealth ™ Medicare specialist for help. 

Late Enrollment Penalty for Part B:

If you do not sign up for Part B when you're first eligible and don't have creditable coverage, you may have to pay a late enrollment penalty. This penalty is a 10% increase in your monthly Part B premium for each whole 12-month period you could have had Part B but didn't sign up. This penalty is typically added to your premium for as long as you have Medicare Part B. Our Medicare agents can help you navigate these complexities to ensure optimal medicare strategies and outcomes.

High Income Earners: How Does IRMAA Affect your Financial Freedom and Tax Efficiency?

If you are a high-income earner, you may be subject to the Income-Related Monthly Adjustment Amount (IRMAA). IRMAA is an extra charge added to your Medicare Part B (Medical Insurance) and Medicare Part D (prescription drug coverage) premiums. Understanding IRMAA is crucial for maintaining financial freedom and optimizing tax efficiency within your wealth management plan. You can take many steps to reduce your IRMAA liability; however, it is best to include these in your comprehensive wealth management plan years before you turn 65. 

How IRMAA is Determined:

The Social Security Administration (SSA) determines if you owe an IRMAA based on your modified adjusted gross income (MAGI) from your IRS tax return two years prior. For example, your 2025 IRMAA will be based on your 2023 tax return.  It should be noted, however, that MAGI is ot the same as your Adjusted Gross Income (AGI) as shown on your tax return.  As an example, MAGI does not allow the deduction of municipal bond interest income from the calculation.  Your calculation is often particularly problematic the year after you retire from formal work because it looks backward at last year’s earnings.   

IRMAA Brackets:

There are several income brackets, and each bracket has a different IRMAA surcharge. As your income increases, so does your IRMAA. Medicare updates the specific income thresholds and corresponding IRMAA amounts annually. It's important to note that these thresholds can change, so it's always best to refer to the most current Medicare guidelines. Guardian Rock’s financial advisory services for high-net-worth individuals can provide up-to-date information and strategies.

Impact on Premiums:

  • Medicare Part B: If your income exceeds the set thresholds, you will pay the standard Part B premium plus an additional IRMAA amount.

  • Medicare Part D: Similarly, you will pay your plan's monthly premium plus an additional IRMAA amount for Part D. (Remember, you must enroll in Part D otherwise, the penalties are cumulative.)

We Suggest Planning To Mitigate Medicare Costs at Least Five Years Before Turning Age 65 for Optimal Results.  

How to Sign Up for Medicare: A Step-by-Step Guide for Financial Freedom

Navigating Medicare enrollment is a crucial step towards securing your healthcare in retirement and achieving financial freedom. At Guardian Rock Wealth ™, we understand the importance of this transition, especially for high-earners and high-net-worth individuals who prioritize comprehensive wealth management.

Medicare Enrollment Typically Happens In A Few Ways:

Note: It is generally recommended to sign up during your IEP to avoid potential late enrollment penalties, especially for Part B. Our financial advisory services team can help you determine the optimal time to enroll, ensuring it aligns with your broader wealth management strategies.

Transitioning to Medicare from
Employer Health Insurance:

A Key Aspect of Wealth Management

Transitioning from employer-sponsored health insurance to Medicare requires careful planning to avoid gaps in coverage or penalties. This is a critical component of effective wealth management that is often overlooked even by professionals, and particularly for high-earning busy executives who often overlook the cost of healthcare during the retirement years no matter what “retirement” means to you. The best approach depends on several factors, including the size of your employer, whether you plan to continue working, and what type of plan you have if you are working.

Key Considerations for Seamless Transition:

Steps for a Smooth Transition with Expert Financial Advisory Services:

What if Your Income Decreased? 

Strategies for Wealth Management:

If your income has significantly decreased due to a life-changing event (e.g., retirement, divorce, death of a spouse), you may be able to appeal your IRMAA decision. You can contact the SSA to explain your situation and provide documentation of the life-changing event and your reduced income. They can use the income from a more recent tax year to determine your IRMAA. This is where proactive financial advisory services and a qualified Medicare agent can help mitigate unexpected costs and preserve your financial freedom and flexibility.

Understanding IRMAA is crucial for high-income earners to budget for their Medicare costs accurately and to avoid unexpected expenses, ensuring their wealth management plan remains robust.

Medicare Basics: Parts A, B, C, and D + The Need for Supplemental Insurance in Your Wealth Management Plan

The Need for Supplemental Insurance (Medigap)
in Your Financial Strategy:

Original Medicare (Parts A and B) covers a significant portion of your healthcare costs, but it doesn't cover everything. You are responsible for deductibles, copayments, and coinsurance amounts. This is where supplemental insurance, often called Medigap policies, comes in, playing a vital role in your **wealth management** and financial freedom.

What Medigap Covers: Medigap policies are sold by private companies and help pay some of the healthcare costs that Original Medicare doesn't, such as copayments, coinsurance, and deductibles. Some Medigap policies also cover emergency healthcare when you travel outside the U.S.
✔ How it Works: You must have Original Medicare (Parts A and B) to buy a Medigap policy. You pay a monthly premium to the private insurance company for your Medigap policy. Medigap policies only work with Original Medicare, not with Medicare Advantage plans.
✔ Why it's Important: Medigap can help limit your out-of-pocket expenses, making your healthcare costs more predictable. It can provide peace of mind by covering the gaps in Original Medicare coverage, a crucial element for in your financial planning. 

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Does Medicare Allow for Rehab? 

Yes, Medicare does cover rehabilitation services, both inpatient and outpatient, under specific conditions. Understanding these provisions is essential for comprehensive wealth management and ensuring continued financial freedom, especially for high earners and high net worth individuals planning for their future healthcare.

The type of Medicare coverage that applies depends on where you receive your rehabilitation and the nature of your medical need.

Inpatient Rehabilitation:

  • Medicare Part A generally covers inpatient rehabilitation care in a skilled nursing facility (SNF) or an inpatient rehabilitation facility (IRF) if it's medically necessary after a qualifying hospital stay (at least three consecutive days as an inpatient). 

  • Skilled Nursing Facility (SNF): Medicare Part A covers up to 100 days of skilled nursing care, which can include rehabilitation services, per benefit period. For the first 20 days, Medicare typically pays 100% of the approved amount. For days 21-100, you'll pay a daily coinsurance. After 100 days, you are responsible for all costs.

  • Inpatient Rehabilitation Facility (IRF): Medicare Part A also covers comprehensive rehabilitation services in an IRF if your doctor certifies that you need intensive rehabilitation, require a hospital-level of care, and can actively participate in therapy.

Outpatient Rehabilitation:

  • Medicare Part B covers medically necessary outpatient rehabilitation services, including physical therapy, occupational therapy, and speech-language pathology services. These services can be provided in various settings, such as a therapist's office, an outpatient clinic, or a hospital.   

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