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If I’m still working at 65, when do I sign up for Medicare?


If you aren’t already receiving Social Security benefits at age 65, you won’t be signed up automatically, so you’ll have to decide when you want to enroll.

But if you continue to work and have health benefits through your job, depending on the size of your employer, you can delay enrolling in Medicare. The same goes for your health insurance if it’s through your spouse’s job. But you need to consider some rules about enrollment.

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Do I need to enroll at 65 if I work for a large company?

You won't have to enroll in Medicare if you have health insurance from a company that employs 20 or more people where you or your spouse actively work. You can delay enrolling in Medicare until the employment ends or the coverage stops, whichever occurs first. You’re entitled to a special enrollment period (SEP) to sign up for Medicare before or within eight months of losing that job-based coverage to avoid a late enrollment penalty.

The law. Large employers with at least 20 employees must offer you and your spouse the same benefits they offer younger employees and their spouses. In this situation, you — not the employer — can decide whether to:

  • Accept the employer health plan and delay Medicare enrollment.
  • Decline employer coverage and rely wholly on Medicare.
  • Have employer coverage and Medicare at the same time.

Many people enroll in Medicare Part A at 65, even with employer coverage because it’s premium-free as long as you or your spouse have paid at least 40 quarters of Medicare taxes. However, you may decide to wait if you want to continue contributing pretax dollars to a health savings account (HSA). You can’t make new HSA contributions after you enroll in Medicare.

Those who have access to employer-based health insurance often delay signing up for Medicare Part B while they’re still working. That way, they don’t have to pay premiums for both Medicare and the employer coverage. Part B premiums are $164.90 a month in 2023, $174.70 in 2024 and more for high earners.

Be aware. If you choose to enroll in both an employer group plan and Medicare Part B, the employer insurance is always primary when a large company provides it. That means it pays your medical bills first.

Medicare will pay only for services it covers that the company plan doesn’t. So unless your employer insurance doesn’t cover much, you could be paying monthly Medicare premiums with little or no return.

Medigap also might be affected. If you sign up for Part B while you still have coverage from a large employer, you may have a difficult time getting a Medicare supplement policy, also called Medigap, after that employer coverage ends.

You have a right to buy any Medigap policy available in your state regardless of your health within six months of enrolling in Part B when you’re 65 or older. But if you enrolled in Part B while working for a large employer and don’t buy a Medigap policy until after that six months have passed, insurers in most states can reject you for coverage or charge more because of a preexisting health condition, except in special circumstances.

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Do I need to enroll at 65 if I work for a small company?

The laws that prohibit large companies from requiring Medicare-eligible employees to drop the employer plan and sign up for Medicare don’t apply to companies with fewer than 20 people. In this situation, the employer decides.

You generally need to sign up for Medicare Parts A and B during your initial enrollment period (IEP), which begins three months before and ends three months after the month you turn 65. If you don’t, you could end up with large coverage gaps.

If the employer requires you to enroll in Medicare, which is most common, Medicare automatically becomes your primary coverage at 65 and the employer plan provides secondary coverage. In other words, Medicare settles your medical bills first, and the group plan pays only for services it covers but Medicare doesn’t.

This means if you fail to sign up for Medicare when required, you essentially will be left with no coverage.

Your first priority should be to ask the employer whether you’re required to sign up for Medicare when you turn 65 or if you’re eligible to receive Medicare earlier because of a disability. Find out exactly how the employer plan will fit in with Medicare. If you’re not required to sign up for Medicare, ask the employer to provide the decision in writing.

What about Medigap when working for a small employer? When Medicare is primary coverage and the employer plan is secondary, you have a guaranteed issue right to buy a Medigap policy within 63 days of losing that coverage, regardless of preexisting conditions. In this situation, signing up for Medicare Part B when you also have employer insurance won’t jeopardize your chances of buying a Medigap policy after your employment ends.

What if I get COBRA or retiree health coverage?

You still need to sign up for Medicare during your initial enrollment period if you continue your former employer’s health coverage through COBRA or if you have retiree health insurance.

Medicare becomes your primary coverage when you turn 65; COBRA coverage is secondary. You also could face coverage gaps if you don’t sign up for Medicare. Retiree health insurance benefits are generally secondary to Medicare, too.

You or your spouse must be actively working for the employer that provides your health insurance if you want to delay Medicare enrollment and qualify for a special enrollment period later.

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Keep in mind  

A caveat on Part A. Many people sign up for Medicare Part A at 65, even if they’re working for a large employer, if it’s premium-free. But if you have a high-deductible health insurance policy and you want to continue contributing to a health savings account, you may want to delay enrolling in Part A.

You can’t do both simultaneously. After you enroll in either Medicare Part A or B, you can’t contribute to an HSA. Some people insured through large employers choose to delay signing up for both parts of Medicare until after they leave the job that provides health insurance. When that happens, you have up to eight months to enroll in Medicare Part B or else you’ll end up with permanent late enrollment penalties.

If you enroll in Part A after 65, that coverage is retroactive for up to six months, so make a note to end your HSA contributions before the date your coverage will take effect. Your HSA annual contribution limit is prorated based on the number of months you had an eligible high-deductible health insurance policy before your Medicare coverage became effective.

A sample calculation. If you retire in September and your Part A coverage will take effect six months before then, you can make three months’ worth of contributions to the HSA. That would be $1,212.48 if you’re 55 or older in 2023 and have self-only health insurance coverage.

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