Answer:

You don’t have to switch to Medicare from Marketplace coverage when you first become eligible for Medicare. However, most people will choose to do so due to late enrollment rules for Medicare and the fact you lose your Marketplace cost assistance eligibility once your Medicare Part A coverage starts.[1]

Generally speaking, if you have coverage through the Health Insurance Marketplace (HealthCare.Gov or your state exchange) you should enroll in Medicare when you first become eligible and then cancel your Marketplace plan. This will ensure you don’t have to pay back Marketplace tax credits and don’t become subject to the Medicare Part B (or in some cases Medicare Part A) late enrollment penalty.

Despite this, if you wish to keep your Marketplace plan after you get Part A you can, you just won’t qualify for cost assistance (don’t worry, there are many types of Medicare cost assistance available instead).

In most cases then there is no point in having coverage under both Medicare and the Marketplace, and instead, those wanting extra coverage should look into Medicare Advantage, Part D, and Medigap instead.

Lastly, you won’t be allowed to buy another Marketplace plan once your contract is up after you have Medicare Part A or Medicare Part B. It’s actually against the law for someone who knows that you have Medicare to sell or issue you a Marketplace policy, so this is yet another reason to just make the switch when you first become eligible for Medicare.

TIP: There are a few very specific situations where you can choose Marketplace coverage over Medicare. For example, if you pay a premium for Part A you can drop Part A and B and get a Marketplace plan instead. For more information see: Medicare and the Marketplace on HealthCare.Gov.

TIP: If you continue to get cost assistance through the Marketplace after you are eligible for Part A, you may owe back tax credits, so don’t forget to cancel your Marketplace plan!

Citations

  1. Changing from the Marketplace to Medicare. HealthCare.Gov.

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