Still Working at 65-Do I Have to Enroll in Medicare?

The short answer is "no," you don't have to enroll in Medicare at age 65, but there are a few caveats that go along with the answer. What's most important is that you know the rules for safely enrolling after age 65 so you don't owe penalty premiums for the rest of your life.

Enrolling in Medicare and Your Employer Group Plan Provides No Advantage
Its important to know that enrolling in Medicare while also covered under your employer's group health plan doesn't mean you get "double" coverage. First, you would be paying a premium for one or more Medicare plans in addition to your employer plan premium. Furthermore, your employer's coverage would be primary paying first. Usually, if the primary plan has paid a claim up to the amount that would have been paid by Medicare if it were primary, no further payment would be made.

Medicare Late Enrollment Penalty Premiums
If your enrollment(s) isn't timely, there is a late enrollment penalty premium for Medicare Part B and Medicare Part D Prescription Drug plan.

• Part B Penalty Premium: Paid in addition to the standard Part B premium, calculated as 10% of the standard premium for each full 12-month period when you should have been enrolled. The amount can change from year to year and is income related.
  
  
• Part D Prescription Drug Penalty Premium: Paid in addition to your Part D premium (amount varies), calculated as 1% per month of the national base beneficiary premium. The amount can change from year to year and is also income related.

NOTE: For most individuals eligible for Medicare at age 65, there is no premium for Part A. However, if someone had to pay for Part A since they didn't qualify for a $0 premium, there would be a penatly premium added for late enrollment after age 65.

For additional information about Medicare enrollment, go to the Medicare menu. You can also download a copy of the latest version of "Medicare and You" using the form in the right-hand margin.

We will break down the answer separating medical coverage from dental coverage.

Maintain Qualified Medical Coverage Through Your Employer After 65
The vast majority of U.S.citizens and permanent residents become "Medicare-eligible" when they turn age 65. However, you are not required to enroll in Medicare at that time as long as the following conditions are met when you enroll in the future.

• You were covered under your employer's ACA-compatible group health plan, without interruption, from the time you turned 65 until the time your Medicare enrollment is effective.
  
  
• You were not employed by a company with less than 20 employees.

Please note that COBRA coverage doesn't qualify as employer coverage.

Paperwork Needed from Employer Showing Continuation of Medical Group Coverage
To avoid being assessed a Part B penalty premium at the time you retire and enroll in Medicare after age 65, you need to provide documentation from your employer attesting to the fact of your enrollment in their group health plan. The required document is, CMS-L564: Request for Employment Information and is found on the CMS website. If this situation applies to you, be sure to request the completed form before you leave the company so you don't run into any issue with your Medicare enrollment.

Maintaining Creditable Drug Coverage Through Your Employer After Age 65
Unlike your employer's group coverage, Medicare medical coverage and drug coverage are not bundled within the same plan. They are administered separately. 

For someone to continue on their group health plan after age 65 without enrolling in Medicare coverage, they must also have creditable drug coverage through their employer's plan. Creditable drug coverage is defined as drug coverage that is as good as or better than the standard Medicare Part D Prescription Drug coverage. Each year, your employer must have their drug plan analyzed to verify it is creditable coverage and then provide a letter to each employee as to whether or not its creditable.

Managing Drug Coverage at Age 65 and After - Employer Plan is Creditable
If you plan on working past age 65 and maintaining your employer's group plan coverage, you may delay your enrollment in Medicare. However, be sure to keep a copy of the creditable coverage letter issued each year from the year you turn 65 to the year you enroll in Medicare.

When you enroll in Medicare, you may be asked for the creditable coverage letters to prove you had such coverage after age 65. Remember, your new Medicare drug coverage must be effective within 63 days after terminating from your employer's group plan.

Managing Drug Coverage at Age 65 and After - Employer Plan is NOT Creditable
If your employer's plan is not creditable and you intend on staying on your employer's plan while working past age 65, you will need to enroll in Medicare Part A and then enroll in a Medicare Part D Prescription Drug plan to avoid late enrollment in drug coverage when you leave your employer's plan.

Schedule Time to Review Medicare Options
As you have seen with the content above, timely Medicare enrollment is essential. We would like to work with you to understand the nuances of Medicare enrollment and help you select the plan that's right for you and your circumstances.

Please contact us using the form in the right-hand menu and we will be in touch to schedule a time.