NC State Health Plan retirees and Medicare

The Part A and Part B requirement

This is the part people miss. As an NC state retiree, you are required to sign up for Medicare Parts A and B when you turn 65. Your retiree coverage is built to coordinate with Medicare, not replace it. If you skip Part B, your state plan will not cover what Medicare would have paid. That is an expensive mistake.

If you are already collecting Social Security when you turn 65, Medicare enrollment is automatic. If not, you enroll yourself through Social Security, ideally in the three months before your 65th birthday month.

Your three options at 65

Once you have Parts A and B, the State Health Plan gives you three choices:

• Base Medicare Advantage plan. This is where the large majority of retirees end up. If your Part B was set up in alignment with your retirement, you default into this plan automatically.
• Enhanced Medicare Advantage plan. A richer version of the base plan, with an extra monthly cost.
• The 70/30 plan. A PPO-style option where the plan pays 70 percent and you pay 30 percent, subject to a deductible and coinsurance. A small share of retirees choose this one.

These are the State Health Plan's own retiree options. They are separate from the Medicare Advantage and Medigap plans sold on the open market, and you cannot mix the two. If you are comparing your state options against outside plans, get the full details on both sides first. Premiums and benefits change from year to year.

Retiring before 65

Retire early and your State Health Plan coverage simply continues. You will get new ID cards because your group changes from active employee to retiree, but your plan works the same. The Medicare decision arrives when you turn 65, not before.

The 2021 cutoff

One more thing to know. State employees first hired on or after January 1, 2021 are not eligible for retiree medical coverage at all. State law ended it for new hires. If you were hired before that date, your retiree eligibility stands. If you were hired after, you will need to plan for Medicare on the open market like everyone else.

What happens if you do nothing

If your Medicare Part B was set up in alignment with your retirement, you default into the base Medicare Advantage plan automatically. That is by design: the state wants you covered. But “default” is not the same as “best for you.” The enhanced plan or the 70/30 plan might fit your situation better, especially if you take expensive prescriptions or see specialists often. Use your first open enrollment to compare all three with your actual health needs in mind, not just the default.

Can you skip the state options and buy your own plan?

Some retirees wonder whether they should pass on the state retiree options and buy a Medicare Advantage or Medigap plan on the open market instead. You can, but understand the tradeoff. The state's base Medicare Advantage plan is heavily subsidized based on your years of service. Walking away from it means giving up that subsidy. Before you do, compare the total cost: premiums, copays, drug coverage, and your doctors. For most retirees with 20-plus years of service, the state option wins on price. Run the numbers for your situation before deciding.

Key dates and contacts

The State Health Plan holds its open enrollment each October, and retirees make their choices through the ORBIT system. That is your yearly window to switch among the three options. Outside of open enrollment, you generally cannot change plans unless you have a qualifying event.

For questions about eligibility and enrollment, the State Health Plan's support center is at 855-859-0966. New to Medicare entirely? Start with the turning 65 guide. Comparing your state options to outside plans? Here is how Annual Enrollment works.