Medicare and Employer Coverage at Age 65 – What You Need to Know

Medicare and Employer Coverage at 65: What You Need to Know

Turning 65 is an important milestone—and it comes with critical decisions about your health insurance. Many people become eligible for Medicare at 65, but if you’re still working and have employer health insurance, understanding how these plans work together is essential. At NISONA, we help clients navigate Medicare and employer coverage to avoid penalties, coverage gaps, or unexpected costs.

Do I Need Medicare if I Have Employer Insurance at 65?

Whether you need to enroll in Medicare at 65 depends largely on the size of your employer:

• Employers with 20 or more employees
  If your employer has 20+ employees, your job-based insurance is considered your primary coverage. You may delay Medicare Part B enrollment without penalty while you’re still working. Many people choose this approach to avoid paying the monthly Part B premium until retirement.

• Employers with fewer than 20 employees
  In smaller companies, Medicare becomes your primary insurance at age 65. You should enroll in Medicare Part A and Part B to ensure full coverage, while your employer’s plan pays secondary.

Why You Should Consider Medicare Part A

Most people qualify for premium-free Medicare Part A at 65. Even if you delay Part B, enrolling in Part A can provide hospital coverage at no cost.

Important: If you contribute to a Health Savings Account (HSA), enrolling in Medicare Part A or B will make you ineligible to continue contributions. In this case, you may consider delaying both Part A and Part B until you retire.

Understanding the Medicare Special Enrollment Period (SEP)

If you delay Medicare Part B because of employer insurance, you can sign up later without penalties during the Special Enrollment Period (SEP).

• The SEP lasts 8 months after your employer coverage ends due to retirement or loss of benefits.

• Missing this window may result in higher premiums for life and delayed coverage.

Who Pays First: Medicare or Employer Insurance?

Understanding coordination of benefits is key:

• Large employer (20+ employees): Employer coverage pays first, Medicare pays second.

• Small employer (fewer than 20 employees): Medicare pays first, employer coverage pays second.

Key Takeaways for Turning 65 with Employer Insurance

✔ Check your employer size to determine if you need to enroll in Medicare at 65.
✔ Consider how Medicare affects HSA contributions.
✔ Don’t miss your Special Enrollment Period to avoid penalties.
✔ Review costs—sometimes having both Medicare and employer coverage is more cost-effective.

How NISONA Can Help

At NISONA, we specialize in guiding individuals through Medicare and job-based insurance decisions. If you’re still working at 65, we can help you:

• Compare your current employer health plan with Medicare options.

• Work with your HR department to clarify coverage rules.

• Develop a personalized strategy to protect your health and finances.

📞 Call NISONA today or schedule a consultation to make sure you have the right coverage when you turn 65.

Source: Medicare.gov