Medicare Enrollment Is Complex And Those Not Receiving Social Security At 65 Are Required To Enroll Themselves; Schumer Bill Would Require Feds To Notify Individuals Turning 65 To Enroll Before They Are Forced To Pay Lifetime Penalties And Fees

Enrollment Errors Have Affected Thousands Of Upstate and Hudson Valley New Yorkers; If Enrollment Missed, Individuals Must Often Wait A Full Year to Receive Insurance; Clear And Simple Advice To Those Approaching Eligibility Age Could Rectify The Problem

Schumer: A Simple and Timely Notice Could Prevent Westchester & Rockland County Seniors From Paying An Arm And A Leg In Fees

During a visit to the Hugh A. Doyle Senior Center in New Rochelle, NY, U.S. Senator Charles E. Schumer today joined dozens of seniors living in Westchester County and President of the Medicare Rights Center, to announce new legislation that would finally require the federal government to notify seniors of their eligibility to enroll in Medicare six months before their initial enrollment period. Right now, seniors, like many in Westchester and Rockland Counties, who do not apply for Medicare within their initial enrollment period are forced to pay exorbitant lifetime fees and penalties. As a result, these eligible seniors are left high and dry waiting up to a full year before they can enroll in Medicare and are hit with a 10 percent penalty on their Medicare Part B Premium for every year they were not enrolled. Even worse, this 10 percent penalty is added to the premium for the duration of their Medicare coverage for a lifetime.

“It may sound simple, but this notice is so much more than a reminder – it’s a lifeline,” said Senator Schumer. “Millions of seniors and people with disabilities in New York – and tens of thousands in Westchester and Rockland alone – rely on their Medicare benefits to lead decent, independent and healthy lives. But unfortunately, Medicare’s current rules are so convoluted that many seniors are at risk of facing critical gaps in coverage when they could desperately need these benefits, or face exorbitant, lifetime penalties that could negatively impact their quality of life. I’m calling on my colleagues to pass this urgently needed, commonsense legislation because a clear and simple notification for those nearing eligibility would go a long way toward addressing this problem and preventing our seniors from being hit with unending, costly fees.”

Schumer explained that when seniors start taking Social Security benefits, they are automatically enrolled in Medicare Part A (hospital insurance) and Medicare Part B (medical insurance) if they signed up for Medicare Part B at the time they signed up for Social Security benefits. However, the full retirement age (the age at which seniors can receive full Social Security benefits), for a senior turning 65 in 2016 is now 66 (used to be 65). For seniors born between 1943 and 1954 the full retirement age is 66, so many seniors are deferring until they can get their full benefits. Additionally, an increasing number of Americans are working longer and are therefore deferring their Social Security benefits past the age of 65. As a result, many seniors turning 65 are required to proactively enroll in Medicare in order to receive their health benefits. But oftentimes, Schumer explained, these soon-to-be eligible seniors fail to properly enroll because they are not informed of Medicare’s complex enrollment process and rules.

When this happens, and individuals do not apply for Medicare as soon as they become eligible, those who should be receiving these benefits are affected in three main ways. First, under current law, if a newly eligible senior misses their enrollment deadline, they are typically forced to wait until the next general enrollment period to enroll (January 1 through March 31), which could be the following year. Then, once they enroll, their Medicare benefits will not go into effect until the next July. Schumer said this could leave people dangerously uninsured for a long period of time. Second, because these eligible beneficiaries did not originally enroll in Medicare when they were first eligible, they are hit with a penalty as high as 10 percent on their Medicare Part B Premium for every year they were not enrolled. This penalty is added to their premium for the duration of their Medicare coverage, meaning they face a lifetime fee that they cannot escape. According to the Medicare Rights Center, in 2014, about 1.4 percent of Part B enrollees (roughly 750,000 nationwide) paid this penalty. On average, their total premiums (standard premium plus penalty) were about 29 percent higher than what they would have been had they not been subject to the penalty. Finally, according to the Medicare Rights Center, many older adults paying for private coverage learn only after a medical treatment that their insurance is secondary to Medicare, and that relying on their insurance instead of enrolling in Part B can create a “gap” in coverage that can cost hundreds of thousands of dollars out-of-pocket.

According to the Medicare Rights Center, the federal government currently does not provide any warning to people nearing the age of 65 that must actively enroll in Medicare. Schumer said this is unacceptable and a simple and clear notification to those approaching eligibility could easily help address the problem. Schumer is therefore urging his colleagues in Congress to support his legislation, called the Beneficiary Enrollment Notification and Eligibility Simplification (BENES) Act, which would help prevent seniors from losing out on coverage and having to pay exorbitant lifetime penalties. Schumer and Senator Bob Casey (D-PA) have co-sponsored this bill in the Senate, and its companion bill is being championed by Congressmen Raul Ruiz (D-CA) and Patrick Meehan (R-PA) in the House of Representatives.

Schumer explained that the BENES Act would include three main provisions aimed at changing this process to serve Medicare recipients across New York and the country:

First, this legislation would require the federal government to send out a warning or notification to seniors as they approach 65 that they need to sign up for Medicare.

  • Specifically, the Department of Health and Human Services (HHS) would be required to work with the Social Security Administration (SSA), and the Treasury Department to develop a notice for those approaching eligibility of when and how they should enroll. Schumer said many federal agencies are looking to help improve the system, but a directive from Congress is needed to facilitate a comprehensive interagency solution.

Second, this bill would help eliminate coverage gaps for seniors.

  • Schumer explained that this bill would establish that Part B insurance coverage will begin the month immediately following enrollment. Right now, coverage does not start until the next July after general enrollment. This measure would ensure that beneficiaries do not experience a break in critical coverage.

Third, the bill would clarify the appeals process for those looking to pursue recourse for their penalty.

  • Schumer said that, right now, those who make an honest mistake must face an opaque appeals process that requires them to prove they received erroneous advice from a federal official. Current law provides no clear process for those seeking equitable relief for failing to enroll in Medicare. Schumer said this standard is virtually impossible to meet and, therefore, the system has to be changed.

Schumer was joined by President of the Medicare Rights Center Joe Baker, New York State Senator George Latimer, and Assemblyman Steven Otis, as well as dozens of seniors living in Westchester County.

“Retirees and those nearing retirement deserve the hard-earned benefits they were promised by the federal government. Senator Schumer’s common-sense legislation would protect seniors in New Rochelle and across Westchester County from coverage gaps and penalties. I applaud Senator Schumer for looking out for our seniors,” said Noam Bramson, Mayor of New Rochelle.

“The federal bureaucracy can be hard to navigate, especially for seniors,” said Phillis Maucieri, Executive Director of the New Rochelle Office for the Aging. “Senator Schumer is working to make the Medicare enrollment process easier and help ensure everyone receives the full coverage they’ve earned. I wholeheartedly support Senator Schumer’s efforts to protect seniors with the BENES Act.”

“Once again, Senator Schumer demonstrates his commitment to seniors and people with disabilities by championing the BENES Act. This bipartisan bill matters for every one of the 10,000 Baby Boomers aging into Medicare each day,” said Joe Baker, president of the Medicare Rights Center, a non-profit consumer service and advocacy organization. “Our health insurance system works a lot differently today than it did fifty years ago, and the BENES Act provides long overdue updates to an enrollment system that was developed when Medicare was first created. The BENES Act will help prevent costly Part B enrollment mistakes that saddle too many New Yorkers with lifetime penalties, higher health care costs, and gaps in coverage. We look forward to working with Senator Schumer to make the BENES Act the law of the land.”

During his visit to New Rochelle, Schumer highlighted the number of seniors in the Hudson Valley, as well as Westchester and Rockland Counties specifically, that have already and will soon become eligible for Medicare and therefore need to enroll:

  • According to NY State Census data, across the entire Hudson Valley region (which includes Dutchess, Orange, Putnam, Rockland, Sullivan, Ulster and Westchester Counties), there were 123,907 seniors who became eligible to receive Medicare benefits between 2010-2015.
    • In Westchester County alone, 51,587 seniors became eligible to receive Medicare benefits between 2010-2015.
    • In Rockland County alone, 16,624 seniors became eligible to receive Medicare benefits between 2010-2015.
  • According to Cornell University’s Program on Applied Demographics, there were an estimated 136,830 seniors who are already or will soon become eligible between 2015-2020.
    • In Westchester County alone, 55,845 seniors are already or will soon become eligible between 2015-2020.
    • In Rockland County alone, 17,098 seniors are already or will soon become eligible between 2015-2020.
  • In addition, according to Cornell, there are 150,206 seniors estimated to become eligible between 2020-2025 and will therefore need to enroll.
    • In Westchester County alone, 60,984 seniors are estimated to become eligible between 2020-2025 and will therefore need to enroll.
    • In Rockland County alone, 18,617 seniors are estimated to become eligible between 2020-2025 and will therefore need to enroll.

Schumer said these increasing numbers show that this process must be fixed before more people, who are soon to be eligible for Medicare, are hit with exorbitant fees and are forced to endure gaps in coverage in the years to come. Schumer said a clear and simple notification to those approaching eligibility could help address the problem.


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