Age 65 or older:
- You qualify for Medicare when you have 40 work credits (after paying Medicare payroll taxes during about 10 years of work). In your case, because you’ll chalk up 28 credits by age 60, you can meet full Medicare eligibility by working three more years. However, even if you retire at 63, you still can’t receive Medicare benefits before age 65 (unless you qualify at a younger age through disability, as explained here).
- If you don’t have enough work credits at age 65, you can buy into Medicare by paying a premium for Part A hospital insurance, as explained here. With 28 work credits, you’d pay the premium’s full cost ($450 a month in 2011; and probably more in future years). If you work an extra six months to gain two more credits, making a total of 30 credits, the Part A premium is reduced significantly ($248 a month in 2011).
- You can buy Medicare Part B insurance (for doctors and outpatient services) whether or not you have sufficient work credits, even if you’re not enrolled in Part A. For most people, the standard part B premium in 2011 is $115.40 a month, and more if your income is over a certain level.
- You can enroll in a Medicare Part D plan (prescription drug coverage), usually for an additional premium, if you have Part A or Part B insurance or both. (See our consumers' guide to part D.)
- You have a guaranteed right to purchase private medigap supplementary insurance, for an additional premium, if you do so within six months of enrolling in Part B. Depending on the kind of policy, medigap insurance pays part or all of out-of-pocket expenses, such as deductibles and copayments (but not premiums), in the traditional Medicare program. But be aware that you can’t use medigap insurance if you’re enrolled in a private Medicare health plan (such as an HMO).
Patricia Barry is a senior editor at the AARP Bulletin.