Do I Need Medicare If I Continue Working Past 65?
Will YOU be working past age 65? If you're planning to delay retirement and need to ensure you have the right healthcare coverage, let’s guide you through the process.
Medicare presents seniors with a dizzying array of choices, some of which have long-term consequences. Understanding how and when to transition from employer-sponsored group health coverage is important for you to make informed decisions and avoid potential penalties and coverage gaps.
Delaying Medicare Enrollment
You probably wouldn't be surprised to know that lots of people work past 65. And if that’s you, you want to understand how that works with Medicare. Everyone has an Initial Enrollment Period, which is the seven months around your 65th birthday month: 3 months before + your birthday month + 3 months after.
I teach seminars on the basics of Medicare for people turning 65. Lots of people come to those presentations just to understand the impact of delaying Medicare enrollment when they opt to work beyond 65.
They have questions about:
- late-enrollment penalties
- and coverage gaps, particularly when a dependent spouse is on the employer’s group health plan.
So what if you're still working? This is where it gets tricky. You've heard about late enrollment penalties, so you may be unsure whether to enroll in Medicare right when you turn 65 or delay some or all parts while continuing with your employer’s insurance.
For people who choose to remain employed beyond 65, the choice of when and how to enroll can depend on the size of your employer and whether your current plan meets Medicare's standards for "creditable coverage."
Can you explain what "creditable coverage" means and when it applies?
Creditable coverage means your group health insurance is at least as good as Medicare. To qualify, you must be actively working for an employer with 20 or more employees.This matters if you delay enrolling in Medicare beyond your initial eligibility at age 65, often because you’re still working and covered by your employer’s plan.
Coverage that does NOT count as creditable includes:
• COBRA
• VA benefits
• Health sharing ministries
All this leads to more questions. When you eventually do decide to retire, how does one make the transition from the employer's group health insurance to Medicare? How does that process work?
Let’s start here.
You may be able to delay if...
This option usually applies to people working for a company with 20 or more employees and having employer health coverage that meets Medicare's "creditable" standards. So, what does that mean? Well, your employer's health plan, including prescription drug coverage, must be as good as or better than what Medicare offers.
You may need to enroll at age 65 if...
On the flip side, usually people with health coverage from an employer with fewer than 20 employees must enroll in Medicare at age 65 or they could face late enrollment penalties.
What if I have coverage through my spouse's employer?
In this case, it can get more complicated. You might still be able to delay Medicare enrollment, or you might need to enroll when you turn 65, even if your spouse's employer has 20 or more employees. The reason? Employers can have their own rules for covering dependents. Some may require dependents with age eligibility (65 or older) to enroll in Medicare to maintain coverage under the employer's plan. If you think this applies to you, reach out to your spouse's employer's benefits administrator for guidance.
CONSIDERATION #1 — Creditable Health Coverage
We’ve already said you need to be actively employed with a company that has 20 or more employees, and you have "creditable" health insurance coverage. But if the answer is "no" to any part of that, you'll probably want to enroll in Medicare when turning 65.
If you ARE actively employed with a company that has 20 or more employees and you have "creditable" health insurance coverage, then the good news is... You have options. You can stay with your employer's health insurance or drop the employer's group health plan in favor of Medicare.
The optimal answer to that typically depends on two things:
- Do you have one or more dependents on your employer's group health plan who are not yet Medicare-eligible?
- How satisfied are you with your employer's group health coverage — is it good, bad, or costly?
You may decide to go ahead and move onto Medicare even if you're working past 65 because Medicare costs less than your group health plan and offers better coverage.
As we explore this further, one of the main challenges individuals face is understanding the implications of delaying Medicare enrollment. By not enrolling in Medicare on time, you could face penalties and potential gaps in coverage, leading to unexpected healthcare costs down the road. That brings us to the second consideration when working past 65.
CONSIDERATION #2 — Form CMS-L564
How do you avoid paying late-enrollment penalties if you don't enroll in Medicare at age 65?
When you eventually retire, you'll ask your human resources people to help you complete Form CMS-L564, which you will provide to the Social Security Administration when you enroll in Part B. No worries, they’ll likely already know what this is about. If not, you can download the form from CMS.GOV. This form, along with your annual Part D Notice of Creditable Coverage letters, serves as proof that you've had creditable coverage during your active employment with an employer with 20 or more employees since you turned 65.
CONSIDERATION #3 — Educate Yourself Early
The third thing you'll want to do is educate yourself about Medicare before you need it. This way, you have a plan for enrollment when the time comes.
- When are you going to begin taking Part A and Part B?
- What are the differences between going with a Medigap Supplement versus an Advantage Plan?
You'll want to make informed decisions about your healthcare coverage ─ the stakes are high. Make sure those things are settled in your mind before choosing which path you'll take.
Getting Medicare While Working
When taking Medicare while you're still working, there are several things to keep in mind:
Coordination with Employer Insurance
Your Medicare benefits can seamlessly complement your creditable employer-provided insurance. Medicare generally acts as the secondary insurer until you either retire or lose your employer's coverage, whichever comes first. At that point, Medicare becomes your primary source of coverage.
Health Savings Accounts (HSAs)
If you enroll in any part of Medicare, you won't be able to continue contributing to a Health Savings Account (HSA). This is an important consideration, especially if you're eligible to delay Medicare enrollment and continue working. You may need Medicare Part A, which is often premium-free for most people, but it might not align with your HSA contributions.
Coverage for Spouse and Children
Remember that your Medicare won't cover your spouse or children. If you choose Medicare and drop your employer's coverage, you'll need to talk to your employer's benefits administrator to explore the options available for your family. Some employers will offer COBRA, so make sure you understand how this decision impacts your loved ones.
So, if you're planning to work past 65, you've got options to consider when it comes to Medicare. It's all about finding the path that suits your needs best.
Informed Medicare Choices
When it comes to your health and financial security, we always want to make wise choices. Your trusted independent Medicare broker will be here to help you make informed decisions that align with your healthcare needs and financial circumstances.
About the Author:
Rodney Powell is the #1 Top Rated Local Medicare Agent for Texas in 2025 with Medicare Agents Hub. "Do It Yourself" isn't a Medicare plan. A FRIEND to come alongside you is priceless. Rodney Powell, the "Medicare Video Guy" - is that person for you. Licensed in 30+ states - he never charges a consultation fee.
Powell has gained a following for his guidance on Medicare Supplement (Medigap), Advantage plans, and prescription drug coverage.
His online resource, MedicareVideoGuide.com, has earned over 50 five-star Google reviews — 100% testament to the trust and satisfaction of the people he serves. For those seeking clarity and confidence in their Medicare choices, he is a trusted advocate who makes Medicare work for people.