Retirement Freedom Act
The Retirement Freedom Act would allow individuals who are otherwise entitled to Medicare Part A (the hospital insurance portion of Medicare) to elect to opt out of that Part A entitlement. The Secretary of Health and Human Services would define the form and method for making this election. If someone opts out, they would be able to later end the election and re-enroll in Part A without penalty, through a process determined by the Secretary. Importantly, opting out would not force the person to opt out of Parts of Medicare other than Part A (e.g., Part B would not be affected), and individuals would not have to repay any Part A benefits paid for services received before the opt-out election. The bill is titled the Retirement Freedom Act and is sponsored in the Senate by Senators Cruz and Lee. In short, the bill is designed to give individuals the choice to drop Medicare Part A entitlement, with a pathway to return later without penalties and without losing Part B rights or needing to repay prior Part A benefits.
Key Points
- 1Eligibility to opt out: Any individual who is otherwise entitled to Medicare Part A may elect to opt out of that entitlement, using a form and process to be specified by the Secretary of Health and Human Services (HHS).
- 2Re-enrollment after opting out: An individual who opts out may later choose to end the opt-out and re-enroll in Part A without being subject to any penalty, using a process determined by the Secretary.
- 3Part B unaffected: Opting out of Part A is not conditioned on any change to Part B rights; individuals may opt out of Part A without being required to opt out of Part B.
- 4No repayment required for prior Part A benefits: Individuals who opt out would not be required to repay amounts paid under Part A for items and services furnished before the opt-out election.
- 5Short title and sponsorship: The bill is titled the “Retirement Freedom Act” and is introduced in the Senate by Senators Cruz and Lee (as of the introduced status).