How Medicare Works with Employer Coverage After 65
A growing number of Americans are working past age 65. If you’re one of them, and you have health coverage through your job, you may find yourself at a confusing intersection between your current plan and Medicare eligibility.
Forming a clear picture of how Medicare works with job-based coverage can help you avoid lapses in care, late penalties, and unnecessary out-of-pocket expenses. It also gives you more control over your healthcare now and later.
At Senior Insurance Agency, we help Nevada residents navigate their health insurance choices with straightforward answers and reliable guidance. In this guide, we’ll break down how Medicare in Reno coordinates with employer coverage, when to enroll, and what to consider if you’re still working after 65.
Table of Content
1. Understanding Medicare Enrollment After 65
2. Can You Keep Your Employer Health Insurance After 65?
3. Medicare vs. Employer Coverage: How They Work Together
4. Signing Up for Medicare if Working Past Age 65
5. Deciding Between Original Medicare and Medicare Advantage
6. What Happens if You Don’t Sign Up for Medicare When First Eligible?
7. Need Help Navigating Medicare and Employer Coverage?
Understanding Medicare Enrollment After 65
Most people qualify for Medicare enrollment at 65, unless they’re already receiving disability benefits or have a qualifying medical condition. Your Initial Enrollment Period (IEP) lasts seven months, starting three months before your 65th birthday month, including that month, and ending three months after.
If you’re asking, “Can I enroll in Medicare after age 65?”, the answer is yes, you can.
Seniors over 65 who have creditable employer coverage can delay signing up for Medicare Part B and Part D without penalty. Once the coverage ends, they’ll likely get an eight-month Special Enrollment Period (SEP) to sign up for Medicare.
However, many still choose to enroll in premium-free Part A at 65, since it generally doesn’t interfere with employer benefits.
Need help making a decision? We offer senior insurance services to help you weigh your choices based on your specific needs.
Can You Keep Your Employer Health Insurance After 65?
Yes, many employers continue to offer health benefits to employees working beyond 65. Some people stay on their job-based plan because:
- Their employer plan has lower out-of-pocket costs.
- They want to keep coverage for a spouse or dependents.
- Their doctors aren’t in the Medicare network.
Others choose to combine their employer coverage and Medicare. Here’s how that works.
Get Clarity on Coverage After 65
Medicare vs. Employer Coverage: How They Work Together
Roughly 40% of adults over 65 have both Medicare and employer-sponsored insurance. When you’re covered by both, one plan pays your healthcare bills first (the primary payer) and the other pays second (the secondary payer). Which plan takes the lead depends mostly on your employer’s size.
If your employer has 20 or more employees, the employer plan is primary, and Medicare acts as secondary. In this case, you have options; you can stay on your employer plan, enroll in Medicare, or use both together.
For employers with fewer than 20 employees, Medicare becomes the primary payer, and the employer plan pays second. You’re not always required to enroll in Medicare, but many smaller employers may ask you to sign up in order for their coverage to coordinate properly.
What About COBRA and Medicare?
COBRA is often available through private employers with 20 or more employees, as well as state and local government jobs. It typically allows you to continue your employer-sponsored health coverage for up to 18 months after losing your job or health benefits. In certain situations, coverage may be extended to 36 months.
If you had Medicare first and then became eligible for COBRA, you can keep both. In that case, Medicare is the primary payer, and COBRA acts as secondary coverage, helping cover costs that Medicare might not.
If you have COBRA before qualifying for Medicare, your COBRA benefits usually end when you turn 65. However, in some cases, COBRA may continue as secondary coverage, particularly for prescription drugs, provided the plan meets Medicare’s creditable coverage standards.
It’s important to note that:
- COBRA counts as creditable coverage for Part D, but not for Part B.
- Relying on COBRA instead of enrolling in Part B when eligible may result in a permanent late enrollment penalty and limited sign-up windows down the road.
If you’re nearing 65 and have COBRA, be sure to review your timeline carefully to avoid unexpected costs or coverage gaps.
Signing Up for Medicare if Working Past Age 65
Seniors working at 65 don’t always need to enroll in every part of Medicare right away. It’s worth comparing the costs and coverage, including premiums, deductibles, and provider access, between Medicare and your employer plan.
If your job-based insurance offers benefits that Medicare doesn’t, such as dental, vision, or wellness programs, staying on your employer plan could make more sense.
When your employer coverage ends, whether due to retirement or other reasons, you’ll trigger a Special Enrollment Period (SEP). The SEP gives you eight months to enroll in Medicare Part B and a 63 day window to enroll in Part D without facing late penalties.
To use the SEP, you’ll need to submit proof of creditable coverage to the Social Security Administration, and possibly to your drug plan provider if you’re enrolling in Part D.
How to Enroll While Still Employed
If you decide to sign up for Medicare while you’re still working and haven’t started receiving Social Security, you’ll likely need to enroll manually. You can do this online through the Social Security Administration’s website. The application will walk you through how to sign up for Medicare at age 65, and if you only want Part A for now, you can simply answer “No” to Part B during the process.
Working with a trusted insurance agent can make this process easier. An agent will help you compare your options and ensure you don’t miss any important enrollment deadlines.
See How Employer Coverage Affects Medicare
Deciding Between Original Medicare and Medicare Advantage
Once your employer coverage ends, or you decide to enroll in Medicare while on the job, one of your first decisions will be whether to go with Original Medicare or a Nevada Medicare Advantage plan.
Original Medicare includes Part A (hospital insurance) and Part B (medical insurance). Many people choose to add a Medicare Supplement plan (also known as Medigap) to help cover out-of-pocket costs like deductibles and coinsurance. You’ll also need a separate Part D plan for prescription drug coverage.
Medicare Advantage (Part C) is a bundled alternative offered by private insurance companies. These plans include Part A and Part B, and sometimes Part D, in one package. Many also offer extra benefits like vision, dental, or life insurance coverage.
When comparing your options, consider:
- How much coverage your employer plan offers
- Whether your preferred doctors and hospitals are in-network
- Monthly premiums, copays, and overall cost structure
- Your need for prescription coverage or additional services
There are multiple types of Medicare Advantage plans, including HMOs, PPOs, and Private Fee-for-Service (PFFS) plans. Each plan type has its own rules for provider access and referrals, so it’s important to compare them based on your healthcare needs and how they may complement your existing employer coverage.
What Happens if You Don’t Sign Up for Medicare When First Eligible?
If you miss your Initial Enrollment Period (IEP) and aren’t covered by a creditable employer plan, you’ll have to wait for the General Enrollment Period (January 1 to March 31) to sign up.
Your coverage will begin the month after you apply. For example, if you apply for Medicare in February, your Part B will begin March 1st.
There are also penalties to consider:
- Part B: Your monthly premium may increase by 10% for each full year you delayed enrollment without creditable coverage. This higher cost stays with you for life.
- Part D: If you go 63 days or more without creditable drug coverage, you’ll pay a permanent penalty added to your monthly premium.
The same applies if you retire, lose your job-based coverage, and miss your Special Enrollment Period. You could face delayed access to care and higher long-term costs.Make sure you understand how to enroll in Medicare and when your deadlines are. Our advisors can help you review your options and make sure you don’t miss any critical deadlines.
Know When to Enroll in Medicare
Need Help Navigating Medicare and Employer Coverage?
For people working at 65, understanding how Medicare fits in with your employer coverage can help you avoid late enrollment penalties, coverage gaps, or paying more than you need to. In many cases, it makes sense to enroll in Medicare at the age of 65, especially if your job-based insurance doesn’t meet Medicare’s standards.
Everyone’s situation is a little different, but you don’t have to navigate it all by yourself. With support, you can make choices that meet your needs now and help you plan confidently for what’s next.
Ready to take the next step? At Senior Insurance Agency, we help take the confusion out of Medicare and give you the clarity to choose with confidence.
Whether you’re just exploring your options or ready to make a change, we’re here to simplify the process. Contact us today!
About the Author: Robbie Rushing
In 1993 I started working for Senior Insurance Agency and purchased the business in 1997. When I first came to work for Senior Insurance Agency the agency already had an excellent reputation within the community for being honest and dependable, a reputation that I’m committed to protecting and strengthening.” Today,…