Can I Work and Have Medicare?

Whether beneficiaries are concerned with affording retirement or love their job, Americans are working later in life. In fact, the percentage of older adults working today is the largest since the creation of Medicare in the 1960s.

Some individuals will still be actively employed upon becoming eligible for Medicare. Can beneficiaries enroll in Medicare while they are still in the work force, and if not, will they get a penalty?

Can Beneficiaries Have Medicare While Working?

If beneficiaries are working when they enter their Initial Enrollment Period (IEP), they can enroll in Medicare. As long as they meet all the criteria needed to be eligible, it is their right to do so. They can also choose to delay their Medicare coverage, though they may be penalized later.

If beneficiaries do not receive health coverage through work, it is safe to say they should enroll in Medicare.

What If They Have Non-Retiree Health Coverage Through Their Employer?

If beneficiaries have non-retiree health insurance through their or their spouse’s employer when they become eligible, they will have to choose if they want to enroll in Medicare Parts A, B, and/or D. Ultimately, this decision depends on the type of health coverage beneficiaries or their spouse currently have and the size of their or their spouse’s employer.

If the employer has fewer than 20 employees, they will probably want to enroll in Parts A, B, and D upon becoming eligible for them. In this situation, Medicare usually becomes their primary coverage. If the employer has 20 employees or more, they may want to delay Parts A, B, and/or D if beneficiaries have sufficient group coverage and know they will not incur late enrollment penalties. Medicare usually pays second to group coverage from larger employers.

Beneficiaries should probably enroll in Part A after qualifying for Medicare. For many seniors, Part A is premium-free and acts as great supplementary coverage. In some cases, it may not make sense to enroll in and pay the monthly premiums that come with Parts B and D right away. Before making the decision to delay any part of Medicare, beneficiaries should compare the coverage to see if enrolling in it while covered by their current health plan makes sense. If they have any questions, they can always reach out to a licensed agent.

When Can Beneficiaries Delay Medicare Without a Penalty?

If beneficiaries have non-retiree group coverage through their employer or their spouse’s employer, they will most likely be able to delay Medicare Parts A, B, and/or D without getting penalized. Beneficiaries could be at risk for receiving late enrollment penalties if:

  • If the company they or their spouse works for has under 20 employees and they delay their Medicare coverage
  • If they get qualifying coverage through their domestic partner’s workplace, but aren’t married to him or her, and delay their Medicare coverage
  • If their employer does not offer creditable prescription drug coverage and/or they go at least 63 days without creditable drug coverage

What Should Beneficiaries Do After They Retire?

Once a beneficiary’s employment or non-retiree employee group coverage ends (whichever comes first), they will enter a Special Enrollment Period (SEP). During this SEP, which starts the month after the qualifying event and lasts for the eight months afterwards, they can usually enroll in Parts A and B without incurring a penalty. If they do not enroll in Parts A and/or B during the SEP, they will start to accrue a penalty that will take effect if and when they enroll in them.

Beneficiaries remaining on their or their partner’s employee health plan after age 65 may seem like a good choice, but that is not always the case. Knowing there are options can keep them covered when they need it most.

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