Still Working at 65? What You Need to Know About MedicareRequest a callback and a licensed Ohio agent will reach out — usually within 24 hours.

The Most Important Question: The '20 or More Employees' Rule

When deciding whether to enroll in Medicare at 65 while still employed, the first and most critical factor is the size of your employer. The federal government has specific rules that determine who pays your medical bills first: your employer's group health plan or Medicare. This is known as the primary versus secondary payer rule. If you work for a company that has 20 or more employees, your group health plan is the primary payer. This means it pays your medical claims first. Medicare is the secondary payer, meaning it would only pay for costs that your primary plan doesn't cover, according to Medicare's rules. For most people in this situation with good employer coverage, it often makes sense to delay enrolling in Medicare Part B, which covers doctor visits and outpatient care, because it has a monthly premium. Your employer's coverage is considered 'creditable,' meaning it's at least as good as what Medicare provides. In this scenario, you can continue with your employer plan and sign up for Medicare later without facing a penalty, as long as you follow the specific enrollment rules when you eventually retire or lose that coverage.

The Small Employer Exception: Fewer Than 20 Employees

The rules change completely if you work for a small business with fewer than 20 employees. In this case, Medicare becomes the primary payer as soon as you turn 65. Your employer's group health plan becomes the secondary payer. This is a crucial distinction that many people miss. If your company has, for example, 15 employees, you absolutely must sign up for both Medicare Part A and Part B during your Initial Enrollment Period. If you fail to do so, your employer’s insurance can legally refuse to pay for services that Medicare would have covered. Imagine having a major procedure at a hospital like University Hospitals. The hospital would bill Medicare first, but if you aren't enrolled, the claim is denied. Then, when the bill goes to your small group plan, they can refuse to pay the primary portion of that bill. This could leave you responsible for 80% of the cost, a financially devastating mistake. Many small business owners and their employees across Ohio need to be particularly aware of this rule. It’s not optional; it’s a fundamental part of how Medicare coordinates with smaller employer plans.

The Case for Enrolling in Medicare Part A (And One Big Reason to Wait)

For the vast majority of Americans who have worked and paid Medicare taxes for at least 10 years (or 40 quarters), Medicare Part A, which covers inpatient hospital stays, is premium-free. Because it's free, many people who are still working for a large employer (20+ employees) go ahead and sign up for Part A when they turn 65. It doesn't cost them anything and acts as a secondary insurance for hospital stays, which could potentially help cover some deductibles or coinsurance left over by their employer plan. However, there is one very significant reason to consider delaying even premium-free Part A: Health Savings Accounts (HSAs). If you have a high-deductible health plan (HDHP) at work and contribute money to an HSA, you cannot legally contribute to that HSA once you are enrolled in any part of Medicare, including Part A. You can still use the money already in your HSA to pay for medical expenses, but your pre-tax contributions must stop. The IRS can impose tax penalties if you continue to contribute after your Medicare effective date. For many people in Northeast Ohio who rely on their HSA to save for future medical costs, this is a major factor in the decision to delay all parts of Medicare until they retire.

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Delaying Part B and Using Your Special Enrollment Period (SEP)

If you have creditable health coverage from a large employer, you can safely delay enrolling in Medicare Part B and avoid its monthly premium. The key is to avoid the lifetime late enrollment penalty. You do this by signing up for Part B during a Special Enrollment Period (SEP). This SEP gives you an eight-month window to enroll in Part B that starts the month after you (or your spouse) stop working or lose your group health coverage, whichever happens first. For instance, consider a 67-year-old from a suburb of Akron who is retiring from a large manufacturing company. She has had continuous health coverage through her job. When she retires on June 30th, her employer coverage ends. Her eight-month SEP to sign up for Part B begins on July 1st. To enroll, she'll work with the Social Security Administration (SSA). She will need to fill out the Application for Enrollment in Medicare Part B (Form CMS-40B) and have her employer complete a Request for Employment Information (Form CMS-L564). This employer form proves to Medicare that she had creditable coverage, which is why she is exempt from the late penalty. It's vital to handle this process correctly to ensure a smooth transition from employer coverage to Medicare.

What About COBRA, Retiree, or VA Coverage?

It's important to understand what types of coverage allow you to delay Medicare. Coverage must be from an employer where you or your spouse are still actively working. COBRA, which allows you to continue your employer health plan for a limited time after you leave your job, does not count as active employment coverage. If you take COBRA after you retire instead of signing up for Part B, you will likely face a late enrollment penalty when your COBRA runs out and you finally enroll in Medicare. You missed your Special Enrollment Period window, which ended eight months after your employment did. Similarly, retiree health plans that a former employer might offer are also not considered active coverage. While these plans can work with Medicare, they do not allow you to delay Part B without penalty. TRICARE and VA benefits for veterans also have their own special coordination rules with Medicare. For veterans, enrolling in Part B is often recommended to ensure you have coverage from civilian doctors and hospitals outside the VA system, as VA benefits alone can sometimes be limiting. These nuances are a perfect example of why getting specific guidance is so important. A misstep with COBRA, for example, could cost you hundreds of dollars a year for the rest of your life.

How to Verify Your Situation and Plan Your Next Steps

Making the right decision starts with getting the right information. First, confirm the size of your employer with your HR department. Don't guess; ask them directly if the company has more or less than 20 employees. Second, if you have an HSA, decide if you value continuing your contributions more than having premium-free Part A as secondary insurance. Third, review your current employer plan documents to understand your deductibles and out-of-pocket costs to see how it compares to what you might pay on Medicare. You can get official information and forms from the Social Security Administration; you can contact the local Northeast Ohio SSA field office for assistance with enrollment. State resources like the Ohio Senior Health Insurance Information Program (OSHIIP) also offer free counseling. However, these government and volunteer programs can provide information but cannot recommend specific plans. For personalized guidance on how your unique employment situation interacts with specific Medicare Advantage, Supplement, and Part D plans available in your ZIP code, speaking with an independent agent is your best path forward. We help families across Northeast Ohio sort through these exact questions every day. The easiest way to get started is to use the callback form on this page to request a conversation with our team.