Like most answers that involve Medicare, it depends.
Let us start with the Medicare basics. When you turn 65, you become eligible for Medicare. Upon turning 65, you have a seven-month window to enroll in Medicare that begins three months before you turn 65, the month you turn 65 and ends three months after you turn 65. If you do not enroll in Medicare during that time, you may face a lifetime of late enrollment penalties unless you have other creditable coverage.
If you are still working at age 65 and have coverage through your employer, you may be able to delay signing up for Medicare.
Employer’s Size Matters
Under current Medicare rules, if you are working for a small company that employees less than 20 people you will have to sign up for both Medicare Part A and Medicare Part B as soon as you are eligible.
If, on the other hand, you are working for a company that employees more than 20 people and you are covered by a group health plan, then in most cases you will not have to sign up for Medicare. When you retire, you will have an eight-month Medicare special enrollment period to sign up for Medicare without incurring any late enrollment penalties.
Signing Up for Medicare Part A?
Medicare Part A covers inpatient hospital care, skilled nursing facility care, hospice care and, in some cases, home health care.
If you have worked for forty quarters (ten years) or more you will not pay a monthly premium for Medicare Part A coverage. Many people will sign up for Medicare Part A knowing that they will not pay a premium, but there are a few things you need to know.
If you sign up for Medicare Part A you can no longer contribute to an HSA (Health Savings Account)
Also, before signing up for Medicare Part A, check with your HR department to ensure that your company drug plan is considered “creditable” by CMS (Centers for Medicare and Medicaid Serves.)
Compare your options
People who have plans with high deductibles through work may want to consider comparing the cost of their employer plan with the cost of Medicare.
If this is something you are contemplating, be sure you take into account the cost of your prescriptions through your employers plan compared to the cost through a Medicare Part D prescription drug plan.
Your employer has fewer than 20 employees
- You must sign up for Part A & Part B when you turn 65 or face a late enrollment penalty.
- Once you retire, you have 63 days to enroll in a Medicare Supplement plan.
- Once you retire you have 60 days to enroll in a Prescription Drug plan
Your employer has more than 20 employees
- If you are covered by a group health plan in most cases you will not be required to enroll in Medicare (check with your HR Department to be sure)
- When you retire you have an eight-month special enrollment period to sign up for Medicare Part A & B
- When you retire you have a six-month open enrollment for a Medicare supplement plan
- When you retire you have two months to sign up for a prescription drug plan
If you are covered under your spouse’s health plan through their employer, the same rules apply.
Retirement benefits that include health insurance or COBRA benefits do not count as creditable coverage.
Your questions and concerns are my business
Medicare can be confusing. I will provide you with the information you need to make an informed decision and help you find the plan that will fit your budget and meets your unique needs. I make the complex simple by shopping the plans and rates for you.
There is never a fee and you are under no obligation to use my services.
Medicare Explained in Plain English