- November 30, 2020
Medicare eligibility for most people begins at 65. However, working past 65 is becoming increasingly common among Medicare-eligible individuals causing many to have questions about Medicare coverage. One of the most common questions individuals working past 65 have is, ”How does Medicare work with my current employer insurance?” Understanding how Medicare works with your current insurance can help determine whether or not you should sign up for a Medicare plan.
Medicare while Employed
If you are currently employed and receiving healthcare coverage through your employer you have options when it comes to enrolling in Medicare while employed. Depending on the number of employees your company has, you may choose to either enroll or delay enrollment in Medicare. If you choose to enroll in Medicare while employed, Medicare will work alongside your employer’s group health insurance plan.
Who Pays First?
Determining who pays first (Medicare or your employer health coverage) depends on the size of the company. Generally speaking, if your company has:
Fewer than 20 employees: Medicare becomes the primary payer. The primary payer pays what is owed on the bill first and sends the rest to the secondary payer (your employer). The primary payer covers the cost up to the limits determined by the coverage. If you are employed by a smaller company you will need to sign up for Original Medicare (Part A and Part B) since Medicare will be the primary payer.
20 or more employees: Medicare becomes the secondary payer. If your group health plan doesn’t cover all of the cost of your medical bill it will be sent to Medicare for a second payment. Medicare states it will make a payment based on “what your group plan paid, what your group plan allowed, and what the doctor or healthcare provider charged.” You will be responsible for any leftover unpaid costs.
At age 65 most working individuals are automatically enrolled in or choose to sign up for Medicare Part A regardless of who becomes the primary or the secondary payer. Medicare Part A is generally free for most individuals so there is very little downside to enrolling.
Depending on whether or not you choose to enroll in or delay Medicare, there are a few enrollment periods you need to be aware of:
Initial Enrollment Period (IEP): If Medicare is the primary payer, you will need to sign up for Medicare during the Initial Enrollment Period. The Initial Enrollment Period runs for 7 months beginning 3 months prior to your 65th birthday and ending 3 months after your birthday month. If you do not enroll in Medicare during this time, you may be subject to late enrollment penalties.
Special Enrollment Period (SEP): Individuals choosing to delay Medicare while employed will need to sign up for Medicare during a Special Enrollment Period. You can choose to sign up for Medicare anytime while you are still covered by your employer’s health plan or a spouse’s employer’s health plan. You also have an 8 month special enrollment period once your employment ends or once your group health plan coverage ends, whichever comes first.
Help with Choosing Medicare while Employed
If you’re Medicare-eligible and currently covered by your employer’s health plan, it is important to understand how Medicare while employed works. While Medicare Part A is free for most, Medicare Part B is not. It is important to weigh all costs and benefits of both Medicare and your employer’s healthcare plan before deciding to enroll.
Deciding whether to enroll in Medicare while employed can be confusing. Working with an experienced insurance agent who is well versed in Medicare insurance can help take the confusion out of deciding whether to enroll or not. With over 40 years of insurance experience, Griset Medicare Solutions has helped many individuals in various circumstances enroll in Medicare coverage that is right for them. Schedule a free no-obligation consultation now by calling (714) 834-1322.
Ready to Discuss your Medicare Options while employed?
Speak with a qualified independent Medicare-focused insurance agent in your area about which plan is right for you. Call us at (714) 834-1322.Schedule Free Consultation