As many Americans prepare for retirement, the topics of Medicare and Social Security are often causes of confusion. For many, these federal programs form the basis of retirement security, yet navigating their rules, deadlines and benefits can feel overwhelming for those unfamiliar with their intricacies. I recently had the opportunity to serve as a guest presenter on a webinar hosted by our Retirement Plans team for their clients and plan participants. During this session, we delved into these topics, including how recent legislative changes may affect retirees now and into the future, and have summarized some of the most important points here.
Medicare: Coverage, Costs, and Critical Deadlines
Let’s start with the background. Medicare coverage is available for individuals aged 65 and older, as well as certain younger individuals with disabilities. Coverage includes the components of what is known as “Original Medicare”: Part A (hospital insurance), and Part B (medical insurance). Those with Original Medicare may also opt for medigap policies, supplemental plans offered by private insurers, to help with out-of-pocket costs. Alternatively, some opt for Part C (Medicare Advantage), which replaces Original Medicare and frequently adds additional coverage. Medicare Advantage plans can be tailored to an individual’s needs but often have strict network requirements for covered services. Finally, Part D (prescription drug coverage) can be added alongside Original Medicare or packaged as part of a Medicare Advantage plan. Retirees who qualify for a benefit from Social Security will pay no premium for Part A. However, Parts B, C and D often carry monthly costs that vary based on income and the selected plan.
Questions arise frequently regarding how and when to enroll in Medicare. The initial enrollment window begins three months before an individual’s 65th birthday and continues for seven months. Mark your calendar because missing this window can trigger late filing penalties. However, those still working and covered by employer health insurance may be eligible for a Special Enrollment Period, allowing them to defer Part B without penalty. You can apply for Medicare through the Social Security Administration via their website, over the phone or by making an appointment at your local SSA office.
Social Security: Strategic Timing Makes a Difference
Social Security benefits are separate from an individual’s Medicare coverage, so eligible retirees must decide when to file for their benefit. Benefits can be claimed as early as age 62, but filing early can reduce monthly payments by as much as 30%. Waiting until full retirement age (between 66 and 67, depending on birth year) ensures retirees receive their full benefit amount, while delaying until age 70 increases one’s benefit by 8% per year. For couples, and particularly for individuals who may not have worked or paid into Social Security themselves, spousal and survivor benefits add further complexity. A spouse may be eligible for up to 50% of the other spouse’s benefit, and surviving spouses can receive up to 100% of the deceased spouse’s benefit under certain conditions. Even divorced individuals may qualify, provided certain criteria are met.
It’s important to note that these benefits aren’t automatic. Working with an advisor or planning specialist can help you understand eligibility, timing and how your marital status may affect your payout. For many, a well-planned Social Security strategy can significantly improve long-term retirement income.
A Major Change: The Social Security Fairness Act
Signed into law in January 2025, the Social Security Fairness Act represents a significant win for millions of public sector workers. The legislation repeals two long-standing provisions: the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).
Previously, the WEP reduced benefits for individuals who earned a pension from non-Social Security-covered employment, such as state or local government jobs, even if they later worked in the private sector. The GPO similarly reduced spousal or survivor benefits for those receiving a public pension. Those who have been impacted by the WEP or GPO, or those who had previously expected benefits to be impacted by these provisions, should reevaluate their options and determine a best course of action in this new legislative environment.
The Bottom Line
Planning for Medicare and Social Security is not a “set it and forget it” exercise. It requires proactive decision-making, a clear understanding of eligibility and timing and a watchful eye on evolving legislation.
Our Estate & Wealth Planning team is committed to helping individuals make informed choices that align with their unique retirement goals. If you’re unsure about your options or how recent changes may impact your benefits, we encourage you to reach out to your advisor.