If you or a loved one pays Medicare premiums by automatic deductions from a Social Security check, some of your insurance coverage could be cancelled.
A “processing error” led to premiums for Medicare Advantage plans (Part C) and prescription drug plans (Part D) to go unpaid nationwide for 250,000 retirees - all the way back to January - according to Social Security and Medicare.
As many as five months of premiums are delinquent for some beneficiaries, the agencies said.
Plan participants should be on the lookout for letters from their insurance companies asking for payment - letters that might easily be overlooked as junk mail or a scam attempt - as insurers notify their customers of the payment lapses.
Retirees will need to find money to pay the outstanding premiums, the agencies said, because Social Security cannot deduct premiums for past months.
Published reports say some beneficiaries have already lost coverage, and it’s unclear how many retirees haven’t yet learned of the error.
Members of the House Ways and Means Committee wrote a letter to the agencies asking for answers.
“For vulnerable seniors and people with disabilities living on fixed incomes, getting a bill for several months of unpaid... premiums could lead to significant and potentially ongoing hardships,” the representatives wrote.
The letter said in 2019, premiums for Part D coverage averaged $30 per month nationally, while Medicare Advantage plans cost up to $200 per month. And on average, retirees receive $1,400 a month from Social Security.
“For someone living on $1,400 a month, any new expense - much less an unexpected bill for $180, or $500, or even $1,200 or more - can make it harder for them to put food on the table, pay for medical care and keep a roof over their heads,” the letter said.
So far, Social Security and Medicare haven’t responded to the letter.
In a memo to insurance companies, Jennifer Shapiro, the acting director for the Medicare Plan Payment Group, said insurers must offer payment plans for those who can’t pay the back premiums in full.
Plans must also offer enrollees a “grace period” to repay the missed premium payments, said Paul Criscione, a certified financial planner with Freedom Capital Management in Colts Neck. The “grace period” must last at least as long as the delay in billing, he said.
“Plans also have the option not to pursue these outstanding payments,” Criscione said.
Beneficiaries who have their premiums charged to a credit card or deducted from a checking account were unaffected.
If you’re not sure if your premiums are current, contact your plan providers and check your Social Security payment records.
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