Medicare Options if Working Past 65
Important Medicare Planning Questions if Working Past Age 65
Does your employer have 20 or more full-time workers?
Is your current health coverage working for you?
Is your employer's drug coverage as good as Medicare Part D?
Are you currently receiving Social Security?
Do you want to keep adding to a Health Savings Account?
Are you and/or your spouse high-income earners?
Are you covered by your spouse's plan or the other way around?
Based on Your Answers : 3 Main Options
* You can delay Medicare Part A and B until you retire or lose employment. You can enroll in Medicare any time during your employment or within 8 months afterwards. Best to enroll 2-3 months prior to retirement to avoid a gap in coverage.
** Once you reach age 65 health government subsidies and cost sharing will typically no longer be provided.
Additional Considerations
Pre-Medicare Planning
Plan for Medicare at least two years before your 65th birthday.
If you plan to work past age 65, speak with your benefits department. Your Initial Enrollment Period (IEP) starts three months before your birthday, includes your birthday month, and ends three months after—totaling seven months.
When comparing your employer plan to Medicare, look at your monthly premium, deductible, co-insurance, prescription drug costs, and maximum out-of-pocket expenses.
Consider switching to Medicare if it offers benefits not covered by your employer plan, like hearing, dental, vision, or gym memberships. (Medicare Advantage requires enrollment in both Part A and Part B.)
Medicare Enrollment Periods
If you work past 65 and choose to delay Medicare, you'll have 8 months to apply for Part B once you retire or stop working. This time period is called the Special Enrollment Period.
It’s best to apply 2-3 months before you stop working to avoid coverage gaps.
There is a 10% penalty for each year you delay Part B enrollment and a 1% penalty for each month you delay Part D, with a 63-day window after your employer coverage ends.
Moving from an employer health plan to Cobra or a Retiree Health Plan is not considered qualified coverage. The 8-month Special Enrollment Period begins when you leave your employer plan, not when you stop Cobra or a Retiree Health Plan.
If you continue working after age 65 and miss the Special Enrollment Period, you can enroll during the General Enrollment Period from January 1 to March 31 each year. However, you might have penalties for not having coverage during the gap.
If you or your spouse have job-based health insurance and wait until after 65 to sign up for Medicare, you can enroll anytime while covered by the group plan or within 8 months after leaving the job.
If you enroll in Medicare Part B, you have 6 months to add Medigap without a health evaluation.
Health Savings Account / Social Security Planning
If you sign up for Social Security at least four months before turning 65, you will automatically get Medicare Part A and B, and you also can’t contribute to an HSA.
If you sign up for Social Security after age 65, you will automatically get Part A and won't be able to contribute to an HSA. Your coverage starts up to six months before you apply, but no sooner than your 65th birthday. Stop adding money to your Health Savings Account (HSA) six months before signing up to avoid tax penalties.
Donut Hole Elimination
Starting in 2025, the Inflation Adjustment Act will limit annual out-of-pocket costs for Medicare Part D to $2,000. If you delay Medicare after age 65 because you have employer coverage, check with your employer to ensure your plan is as good as Medicare Part D.
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