If you are 65 years of age and still working, chances are you may be ready to enroll in Medicare. Retirement comes up quickly, especially when you’re busy working a nine to five job or something in between. 

So, when should you enroll in Medicare if you’re 65 and still holding down a job? According to experts, Medicare coverage begins when you enroll in Medicare and the sign-up period during which you choose to enroll. Your first opportunity to enroll is 3 months before you turn 65, with the coverage beginning the first day of your birthday month. This is referred to as your Initial Enrollment Period.

However, things may be a bit different if you’re still working. Experts assert that there are many benefits to enrolling in Medicare while you are working at the age of 65. You can enroll in Medicare Part A whether you work or not. According to the Department of Health and Human Services, Medicare Part A covers inpatient care in a hospital and care in skilled nursing facilities.

If you are 65 or older and still working, deciding when you should enroll depends on several factors, namely the size of your employer. Several other factors play a role as well. Many people who are 65 and still working wonder if they should stay with the health insurance provider offered by their employer or if they should move on to Medicare.

Many people over 65 continue to work beyond 65, because they need to pay bills and potentially put their children through college. As of 2020, 26.6% of seniors between age 65 and 74 were still working. This trend is expected to continue, especially as prices rise, and there is a growing demand for health care. 

In some cases, working beyond 65 can be a good thing, because it proves you can maintain vitality as you age. Despite this, it is critical to have good health insurance, because health often declines as you age. If your employer offers better health coverage than Medicare, look at what your employer’s insurance covers and what Medicare covers. The size of your employer is critical to your decision, as well 

However, to do this, you will need to become familiar with what Medicare offers, when compared to your employer’s coverage. Also find out what your deadlines to enroll are. Familiarizing yourself with this makes your transition into Medicare easier, regardless of your age.

Bear in mind that you are immediately enrolled in Medicare Parts A and B when you file for Social Security. You can, however, opt out of Part B. It may be beneficial to do that, especially if “you or your spouse” is insured by an employer’s insurance plan.

If you have yet to file for Social Security, you can choose to sign up for only Medicare Part A. Conversely, you can also sign up for Medicare Part A and Medicare Part B. The vast majority of those who sign up for Part A reap many benefits of secondary hospital coverage, especially if they continue to work. The nice thing is that you do not need to pay premiums if you have worked a minimum of 10 years. If you enroll while you are working, you will avoid experiencing any gaps in coverage as you transition from working to retirement. 

You become automatically eligible to sign up for Medicare when you turn 65. This is true, even if you are still working. However, to have full eligibility for Medicare, you must be a US citizen and be a resident of this country for the past five years. However, if you have insurance through you or your spouse’s employer, you might not need to sign up until your spouse or you lose your health insurance or stop working.

Consider several factors, including your employer’s gap coverage and potential penalties when you transition from your employer’s insurance to Medicare. If you work for a company with 20 or more employees, you may want to keep your company’s plan. That way, you can hold off on getting Medicare Part B. 

If your company has fewer than 20 total employees, Medicare will be considered your “primary insurer,” experts say and you need to enroll in A and B during your initial enrollment period to avoid penalties. 

But what exactly is a Special Enrollment Period? It’s critical to know what an open enrollment is, so you know what to expect during open enrollment periods.

After you quit your job, you have a total of eight months to sign up for Medicare Part B under a Special Enrollment Period or SEP starting 8 months from the date your employment ends or coverage is terminated, whichever happens first. Others can participate in an SEP if you have a special circumstance, such as moving to a new state, losing coverage, or giving birth. 

By understanding these enrollment periods, you will know when you are able to enroll or change an existing health insurance policy.

If you work for a company with 20 or more employees and delay enrollment into part B, you have 8 months to enroll in part B as a Special Enrollment Period.

For Medicare Advantage and Part D, on November 15th of each year, you are eligible to enroll for a health plan that continues into the next year. During this AEP, you can enroll, change your MA and Part D plan, or re-enroll in original Medicare. December 7th is the last day you are eligible to change plans or enroll in a new plan that will start on January first. 

After you re-join original Medicare, you may apply for a Medigap policy with health underwriting unless you have a guarantee issue right or trial right to buy a Medicare Supplement plan. 

In some cases, you may wish to purchase a Medicare Supplement policy. If you join part B during your SEP, you have 6 months from your part B effective date to have a guaranteed issue right to buy a Medicare Supplement plan with no health underwriting. If you enrolled in A & B at 65 and were still working, it’s likely your open enrollment period will have passed by the time you retire. You have 63 days to enroll in a Medigap plan, in that case, with no health underwriting, from the date your coverage is terminated by your current employer. 

However, if you like the plan you currently have, you may wish to stay with that plan. If you are happy with your current plan, it may be a good idea to continue working until retirement. That way, you can keep your coverage until you stop working. If you want to continue to save pre-tax money, it may be wise to hold off on getting Medicare part B if you work for a company with more than 20 employees. 

Bear in mind that when you stop working, you can no longer put money in a health savings account (HSA). If you have Original Medicare and are working in a company with less than 20 employees, you likely won’t need a Medigap policy while you’re actively employed. Your employer’s insurance will cover costs that Medicare does not cover if Medicare does not. You will then have a guaranteed issue right to buy a Medicare Supplement policy 63 days after employer coverage ends.

If you are trying to decide if you should keep your employer’s insurance or sign up for Medicare, consider several things. If your company is small, it may be a good idea to sign up for Medicare Parts A, B, and D right away. It is also a good idea to ask your employer how Medicare Advantage would affect you.

Consider spousal benefits. If your spouse has insurance under his or her employer, your spouse’s choices for health care may change when you sign up for Medicare. If you’re a dependent on your spouse’s coverage, you will qualify for the same SEP he/she has. Cobra and retiree coverage do not qualify for a SEP. 

There may be penalties for not signing up for Medicare when you are first eligible to do so. You may be required to purchase Medicare Part A if you haven’t worked 40 full quarters. If you do not do so when you are eligible, your monthly premium can go up by 10 percent. If you fail to enroll, you must pay a penalty that is “twice the number of years” that you did not sign up. 

However, there are things you can do to avoid late enrollment penalties. One of the best ways to avoid a late enrollment penalty is to enroll in Medicare as soon as you are eligible to do so. However, if you delay part B and qualify for an SEP, there is no penalty. 

You can also sign up for a Medicare drug plan without a penalty if you lose other coverage and that drug coverage is considered Creditable Drug Coverage. You may have creditable drug coverage from a former or current employer. It can also come from a union.

It may also help to keep records that show times you had creditable drug coverage. If your insurance plan asks about your drug plan, you have proof of your drug coverage. It is important to tell your provider what drug coverage you had previously. If you don’t, you may be required to pay a penalty the entire time you have prescription drug coverage through Medicare.

6 Sources

MedigapCoverage has strict sourcing guidelines to ensure our content is accurate and current. We rely on peer-reviewed studies, academic research institutions, and medical associations. We strive to use primary sources and refrain from using tertiary references.

https://www.hhs.gov/answers/medicare-and-medicaid/what-is-medicare-part-a./index.html

https://www.schwab.com/learn/story/65-and-still-working-should-you-enroll-medicare.

https://www.anthem.com/medicare/learn-about-medicare/medicare-enrollment

https://www.peoplekeep.com/blog/what-is-a-special-enrollment-period.

https://www.bcbs.com/medicare/medigap

https://www.uhc.com/news-articles/medicare-articles/what-is-creditable-drug-coverage