There are over 10 million people over the age of 65 who are still working. Many seniors continue to work for various reasons, such as wanting to remain active or needing additional income. If you are nearing 65 and are not quite ready to retire, what should you do about Medicare? Can you still work and apply for Medicare? When does it make sense to delay applying to Medicare?
This article will answer those questions and go through various common scenarios.
Can I still work and apply for Medicare?
Short answer, yes. If you’re employed and have health insurance through your employer, or if you can get coverage from your spouse’s group plan, you can delay applying for Part A or Part B. But you may be able to get additional benefits if you do sign up while still working.
What are the benefits of applying for Medicare as soon as I am eligible?
If you’re enrolled in Medicare, you may have access to additional benefits like access to an enhanced prescription drug plan and help with preventive care services. You may also be eligible for financial assistance to help cover the cost of premiums, deductibles and co-pays.
Additionally, there are many penalties for delaying enrolling in Medicare. For example, if you have passed the 8-month special enrollment period after losing your employer’s health care plan, you may face a 10% increase in Part B premiums for every 12 months that you delay enrolling. If you enroll in Medicare as soon as you are eligible, you will not have to worry about this penalty.
When should I delay applying to Medicare?
We will look at various situations below. However, generally speaking, if you:
- are employed by a large employer (meaning 20+ employees);
- have health insurance coverage and are happy with the plan; and
- qualify for premium-free Part A coverage
then you should delay applying for Medicare.
Specific examples of working past age 65
Now let’s review some specific scenarios for working past 65 and what to do about Medicare.
You (or your spouse) work for a small employer that provides insurance.
Suppose you or your spouse are working for a small employer (meaning fewer than 20 employees) that provides health insurance.
In this instance, you must enroll in both Parts A and B. Medicare is your primary insurer and your employer will be the secondary provider when you are able to do so. Your employer’s insurance will fill the gaps of what’s not covered under Medicare Parts A and B, but you absolutely need to apply for Medicare.
You or your spouse work for a large employer that provides insurance.
Let’s imagine now that you or your spouse work for a large employer (meaning more than 20 employees) that provides insurance.
If you don’t have to pay a premium for Part A, you can choose to sign up at age 65 or later. (Premium-free Part A means you must have paid into Medicare out of your FICA payroll taxes for at least ten years.) There are a few downsides to applying for Part A when you become eligible.
Again, with Part B, the same rule applies to small employers. If you or your spouse are employed during the initial enrollment period, you become eligible for an 8-month special enrollment period. As long as you sign up within eight months of losing your employer-sponsored health coverage, you won’t have to pay any late enrollment penalties.
In this instance, your employer’s health plan will be the primary provider, and Medicare will be the secondary provider.
You or your spouse work, but the employer-provided plan has a lot of gaps in coverage.
Let’s finally imagine you or your spouse are still working, but the employer-provided plan is missing some critical types of coverage. You look at Medicare and either a Medicare Advantage Plan or Supplement Plan and realize those plans provide more coverage than your employer-provided plan.
You can opt out of your employer’s plan and sign up for Part A and Part B of Medicare and an Advantage or Supplemental Plan. You will have better coverage and be able to avoid any penalties as a result of late enrollment.
In this instance, Medicare will be your primary insurer, and your employer’s plan will no longer provide coverage.
You or your spouse work but are self-employed or do not have a health plan through your employer
In this instance, you will definitely want to apply for both Part A and Part B of Medicare when you turn 65. You can avoid any late enrollment penalties by signing up within the initial enrollment plan. However, you may be worried about the premiums. This article outlines ways to help you with the costs.
Navigating your Medicare options
When it comes to Medicare and enrollment, there are many options to consider. But it is important to remember that you have the power to make informed decisions about your health care.
At The Medicare Family, we are here to help you understand your options, answer questions, and make sure that you get the coverage that best fits your needs. Our experienced team of experts has the knowledge to help you make sense of Medicare and choose the right plans for you.
For more information, contact The Medicare Family to schedule an appointment to discuss your unique needs and find the best plan for you.