If I have Employer Group Health Coverage
do I need to enroll in Parts A Hospital & B Doctor Visits?
If you didn’t enroll when you were first eligible, the size of the employer determines whether you have to pay a penalty if you enroll later.
You should sign up for Part A and Part B when you’re first eligible. Medicare will be primary and pays before your other coverage.
The employer has 20 or more employees.
Ask the benefits manager whether you have group health plan coverage (as defined by the IRS). People with group health coverage based on current employment may be able to delay Part A and Part B and won’t have to pay a lifetime late enrollment penalty if they enroll later.
How you delay your coverage depends on your situation:
- If you’ll be getting benefits from Social Security or the Railroad Retirement Board (RRB) at least 4 months before you turn 65, you’ll automatically get Part A and Part B. You’ll get your red, white, and blue Medicare card in the mail 3 months before your 65th birthday. If you don’t want Part B, follow the instructions that came with the card. If you keep the card, you keep Part B and will pay Part B premiums.
- If you won’t be getting benefits from Social Security or the Railroad Retirement Board (RRB) at least 4 months before you turn 65, you don’t need to do anything when you turn 65.
If you’re eligible for premium-free Part A, you can enroll in Part A at any time after you’re first eligible for Medicare. Your Part A coverage will go back (retroactively) 6 months from when you sign up (but no earlier than the first month you are eligible for Medicare).
If you aren’t eligible for premium-free Part A, and you don’t buy it when you’re first eligible, you may have to pay a penalty.
Premium-free Part A coverage:
- Begins 6 months back from the date you apply for Medicare (or Social Security/RRB benefits). To avoid a tax penalty, you should stop contributing to your Health Savings Account (HSA) at least 6 months before you apply for Medicare.
- Begins no earlier than the first month you were eligible for Medicare.
If you aren’t eligible for premium-free Part A, and you don’t buy it when you’re first eligible, your monthly premium may go up 10%. You’ll have to pay the higher premium for twice the number of years you could have had Part A, but didn’t sign up.
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Once your Initial Enrollment Period ends, you may have the chance to sign up for Medicare during a Special Enrollment Period (SEP). If you’re covered under a group health plan based on current employment, you have a SEP to sign up for Part A and/or Part B anytime as long as:
- You or your spouse (or family member if you’re disabled) is working.
- You’re covered by a group health plan through the employer or union based on that work.
You also have an 8-month SEP to sign up for Part A and/or Part B that starts at one of these times (whichever happens first):
- The month after the employment ends
- The month after group health plan insurance based on current employment ends
Usually, you don’t pay a late enrollment penalty if you sign up during a SEP.
COBRA and retiree health plans aren’t considered coverage based on current employment. You’re not eligible for a Special Enrollment Period when that coverage ends. This Special Enrollment Period also doesn’t apply to people who are eligible for Medicare based on having End-Stage Renal Disease (ESRD).
If you have a Health Savings Account (HSA) with a High Deductible Health Plan (HDHP) based on your or your spouse’s current employment, you may be eligible for an SEP. To avoid a tax penalty, you should stop contributing to your HSA at least 6 months before you apply for Medicare. You can withdraw money from your HSA after you enroll in Medicare to help pay for medical expenses (like deductibles, premiums, coinsurance or copayments).