Medicare Benefits for Disabled Individuals

Medicare Benefits for Disabled Individuals

December 06, 2023

What is it?

Under certain conditions, disabled individuals are eligible to enroll in Medicare, the federal health insurance program that currently consists of premium-free hospital insurance Part A protection, premium-paid medical insurance (Part B) protection, Part C, which allows private companies to offer Medicare benefits as well as benefits not offered by Medicare, and Part D, which covers the costs of prescription drugs.

Which disabled individuals are entitled to enroll in Medicare?

Disabled workers age 65 or older

All persons age 65 and older, whether disabled or not, who are entitled to receive Social Security benefits are eligible to enroll in Medicare. Enrollment at age 65 is automatic if you are already receiving Social Security benefits. And because Medicare eligibility is income-blind, you can continue to receive Medicare benefits even if you work after you begin receiving Social Security benefits.

Disabled beneficiaries under age 65 who have been receiving Social Security disability benefits for more than 24 months

If you have been receiving (or have been entitled to receive) Social Security disability benefits for at least 24 months (not necessarily consecutively), you may be eligible to enroll in Medicare. To enroll, you must be entitled to benefits in one of the following categories:

  • You are disabled, of any age and receiving worker's disability benefits
  • You are a disabled widow or widower age 50 or older, or
  • You are a disabled beneficiary who is older than age 18 who receives benefits based on a disability that occurred before age 22

Individuals disabled by renal disease

A person who is disabled as a result of chronic kidney failure, who requires dialysis or a kidney transplant, and who is fully or currently insured or entitled to payments either under the Social Security Act or the Railroad Retirement Act is entitled to enroll in Medicare. His or her spouse and dependent children are also entitled to enroll in Medicare.

Individuals disabled by ALS

A person disabled by Amyotrophic Lateral Sclerosis (ALS) automatically gets Medicare Parts A and B the month the disability begins.

Some disabled beneficiaries who return to work

If you are no longer entitled to receive Social Security disability benefits because you have returned to work, you may have your Medicare coverage continued for 93 months after the trial work period. However, this coverage extension applies only if your disabling condition continues, even if it doesn't prevent you from working and you meet other eligibility requirements. After that period, you will no longer be able to obtain Medicare Part A premium free, but if your disabling condition continues, you can purchase Medicare Part A coverage by paying premiums.

Tip: If you are a qualified low-income person who is working, your premiums for Medicare Part A may be paid by your state Medicaid agency.

Some previously disabled individuals

If you become re-entitled to receive Social Security disability benefits after the end of a previous period of entitlement, you are automatically eligible for Medicare coverage and no waiting period applies. However, this rule applies only to workers who become re-entitled within five years after the end of their previous period of entitlement (seven years for widows, widowers, and dependent children). The five- or seven-year requirement will be waived if the previous period of disability ended after February 20, 1988, and the current disability is the same as or related to the previous disability.

How does Medicare coverage affect other medical coverage that a disabled individual might have?

Medicare is usually the primary payer

Medicare is the only medical insurance some disabled people have. However, you may also be entitled to receive benefits from another health insurance policy as well as Medicare. So which insurance will pay your claim? In most situations, you will submit your claims to Medicare first, but there are exceptions: If you are covered by an employer-sponsored group policy or another type of social insurance, Medicare will be the secondary payer.

Medicare will be the secondary payer on services covered under employer-sponsored group health plans

If you are disabled and covered under a group health plan, either through your own employer or the employer of a spouse or family member, you must apply for benefits from your group health plan first. If your group health plan rejects the claim because the services are not covered by the plan, Medicare will then pay if Medicare covers those services. This applies if the plan is sponsored by an employer who has at least 100 employees. If you are over 65 and working, this rule applies if your employer has 20 or more employees.

Example(s): After he was released from the hospital, Claude submitted a claim to his group health insurance company. His claim was paid except for one item--occupational therapy he received while he was in the hospital. His insurance contract did not cover this type of therapy. However, since Medicare covers occupational therapy, Medicare paid the remainder of Claude's medical bill as second payer.

Medicare will be the second payer if you are eligible to receive medical benefits under certain other social insurance programs

If you are entitled to medical workers' compensation benefits, veterans benefits, or black-lung benefits, Medicare will be the second payer.

Group health plans may not discriminate against Medicare beneficiaries

Group health plans may not discriminate against Medicare beneficiaries who are disabled. They cannot refuse to insure you because you are also covered under Medicare for a disability.

Questions & Answers

If you are disabled and have other group medical insurance, do you have to enroll in Medicare?

Enrollment in Medicare is automatic if you have already been receiving Social Security disability benefits at the time you become eligible for Medicare. Enrollment in Medicare Part A is compulsory, but you can decline to enroll in Medicare Part B by filling out a form that will be sent to you, and you will not have to pay the premium for Medicare Part B. If you change your mind, you can still enroll later during a special open enrollment period. Your enrollment in Medicare Part A, however, will not cost you anything, and since Medicare Part A will be the secondary payer to your group health insurance plan anyway, think twice before declining coverage.

If you are awaiting a kidney transplant and undergoing dialysis, when will you be eligible for Medicare benefits?

Your Medicare coverage can begin with the first day of the third month after the month your dialysis treatments began. However, if you are expecting a transplant soon, a different rule may apply. Your Medicare coverage will begin either with the month of the transplant, or if you are hospitalized before the transplant to undergo procedures related to the transplant, in that month, as long as it was within two months of the transplant.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

The information provided is not intended to be a substitute for specific individualized tax planning or legal advice. We suggest that you consult with a qualified tax or legal professional.

LPL Financial Representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial.

This article was prepared by Broadridge.

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