Working Past 65: How to Handle Medicare

Working Past Age 65: How to Handle Medicare

With all the information available on the Internet and the commercials on television for Medicare, it can be challenging to distinguish what is true and what might be a marketing gimmick.  When it comes to your healthcare coverage and your budget, unreliable information is simply not acceptable. Moreover, Medicare enrollment and rules change based on particular situations and circumstances. Let’s say that again: Medicare is ALL about the fine print! Your individual situation won’t be the same as anyone else’s, so please don’t let what you heard from a neighbor, friend, or family member impact your understanding.

Do the research yourself – if you have the time! Your other option is to find an expert, someone who is truly well-versed in the subtle nuances of Medicare and ask lots of questions. I won’t ever “sell” you on something that isn’t exactly what you’re looking for. Check out what I mean when I use the term Independent Medicare Agent.

One of the most common mistakes and misconceptions impact those who are working past age 65. If you (or your spouse) are still working, Medicare has a different set of rules just for you!

All the details about working past age 65 and figuring out Medicare are below. Think of this as your Medicare Q & A for people who are working past the “traditional” retirement age.

Do I need to sign up for Medicare when I turn 65?

Like many of these questions, my answer will be: it depends! It depends on how you get your health insurance now and if you are working. It also depends on the number of employees at your company (or that of your spouse’s if your health insurance is through them). If you plan to keep working or you have employer health coverage through a spouse, you have some options to consider regarding signing up for Medicare.

Before we get too into the details, I want to clarify that ‘working’ means active employment, not retired.

Should I enroll in Medicare if I'm working past 65 and my company has more than 20 employees?

If you (or your spouse) work for an employer or company with 20 or more employees and you are enrolled in their group health insurance plan, you are able to delay Medicare enrollment without penalty.

Of course, it always comes down to cost and the nature of the coverage. Be sure to look at the costs of Medicare AND the cost of your group plan to determine which option is more appropriate for your individual medical and financial needs. It may surprise you both at the varying cost of each option as well as the medical coverage. This is why it’s so important to work with an expert like Medicare Dana, so you can go over all your options to evaluate each situation. There’s just no one size fits all with health coverage!

How does Medicare coordinate with other health insurance?

Fewer than 20 Employees

If you (or your spouse’s) employer or company have fewer than 20 employees:

Medicare pays for services first, and your job-based insurance pays second.

• If you don’t sign up for Medicare Part A and Medicare Part B, your job-based insurance might not cover the costs for services you get. You also may incur a late enrollment penalty for Medicare. Nobody wants to pay late enrollment penalties as they follow you for life!

If you have even more questions about how Medicare works with other health insurance, visit this section on

More than 20 Employees

If you (or your spouse’s) employer or company have more than 20 employees:

Your job-based insurance pays first, and Medicare pays second.

• In this situation, you do not need to enroll in Medicare.

• If you qualify for premium free Medicare Part A, you can (and should) enroll in Part A only*.

• You can wait until you stop working (or lose your health insurance, if that happens first) to sign up for Medicare Part B, and you won’t pay a late enrollment penalty.

*A very important detail for those who fall into this category: If you contribute to a Health Savings Account (HSA), you should not enroll in Part A. You cannot contribute to an HSA and be enrolled in Medicare. If you do, you may obtain tax penalties.

Getting a Stipend for Health Insurance

If you (or your spouse) get a stipend from your employer to buy your own health insurance OR you (or your spouse) are still working, but don’t have health insurance through that job:

  • Generally, Medicare doesn’t work with your insurance, and you need to enroll in Medicare.
  • Once you sign up, Medicare pays first.
  • Some private insurance has rules that lower what they pay (or don’t pay at all) for insurance services you get if you’re eligible for other coverage, like Medicare. Meaning they will not cover your claims.

If you have COBRA:

  • Medicare pays first once you turn 65, so if you do not enroll in Medicare while on COBRA they may not pay your claims since you are now Medicare eligible.
  • Sign up for Medicare when you turn 65 to avoid gaps in coverage and a monthly Medicare Part B Late Enrollment Penalty.

Do your homework if you work past age 65!

If you’ll be working past the age of 65, a great place to start is with your human resources department at your company. They’ll be able to give you some details about your health insurance coverage from employment, and point you in the right direction. As you can see, it’s an individual process to determine who really needs to enroll in Medicare and who does not! It’s a dangerous risk to take if you are uninformed. If you scrolled all the way down here and didn’t read all the caveats above, at least get these few points!

Do your research. The coverage offered by your job (or your spouse’s) may not be the best option for you. And remember the best option isn’t necessarily the least expensive!

Be sure you aren’t paying for two plans if you are automatically enrolled in Medicare Parts A and B through Social Security. (If you’re still covered by your employer you could be paying double!)

Look at the fine print on HSAs and Medicare. If you enroll in any part of Medicare, you can no longer contribute to an HSA.

Pay attention to the timing, especially if you know when you’ll be leaving your job. You will need to enroll in Medicare months before your employment ends!

If all these tips feel a little overwhelming to you, you’re not alone. Like I said earlier, Medicare is all about the fine print. There is just a lot to know about the program. Your health coverage is too important to leave to the last minute, so schedule a consultation with me today.