Can I Have Employer Insurance and Medicare at the Same Time?

If you are age 65 or older, or have a disability, you may be eligible for Medicare, the federal health insurance program. Medicare provides coverage for hospital stays, doctor visits, prescription drugs, and other medical services. But what if you also have health insurance from your employer? Can you have both Medicare and employer coverage at the same time? And if so, how do they work together?

The answer is yes, you can have both Medicare and employer coverage at the same time. However, there are some important things to consider before you decide to enroll in both types of plans. In this article, we will explain how Medicare works with employer insurance, how to choose between them, and what to do if you want to keep both.

How Medicare Works with Employer Coverage when you turn 65

Medicare consists of four parts: Part A (hospital insurance), Part B (medical insurance), Part C (Medicare Advantage Plan), and Part D (prescription drug coverage). Part A and Part B are also known as Original Medicare. Part C and Part D are offered by private insurance companies that contract with Medicare.

If you have Medicare and employer insurance, each type of coverage is called a payer. When there is more than one payer, coordination of benefits rules decide who pays first. The primary payer pays what it owes on your bills first, and then sends the rest to the secondary payer to pay. In some rare cases, there may also be a third payer.

The primary payer is usually the one that pays more of your medical costs. The secondary payer only pays if there are costs that the primary payer did not cover. The secondary payer may not pay all of the remaining costs.

The primary and secondary payer depends on the size of your employer and whether you are retired or still working. Here are some general rules:

·        If you are 65 or older and have group health plan coverage from your current employer or your spouse’s current employer, and the employer has 20 or more employees, your employer insurance is the primary payer and Medicare is the secondary payer.

·        If you are 65 or older and have group health plan coverage from your current employer or your spouse’s current employer, and the employer has less than 20 employees, Medicare is the primary payer and your employer insurance is the secondary payer.

·        If you are under 65 and have group health plan coverage from your current employer or a family member’s current employer, and the employer has 100 or more employees, your employer health insurance coverage is the primary payer and Medicare is the secondary payer.

·        If you are under 65 and have group health plan coverage from your current employer or a family member’s current employer, and the employer has less than 100 employees, Medicare is the primary payer and your employer insurance is the secondary payer.

·        If you have Medicare due to end-stage renal disease (ESRD), which is permanent kidney failure that requires dialysis or a transplant, your employer insurance is usually the primary payer for the first 30 months after you become eligible for Medicare. After that, Medicare becomes the primary payer and your employer insurance becomes the secondary payer.

·        If you are retired and have group health plan coverage from your former employer or your spouse’s former employer, Medicare is always the primary payer and your retiree coverage is always the secondary payer. So Medicare insurance pays to your health savings account.

These rules may vary depending on your situation. For example, if you have a health maintenance organization (HMO) plan or an employer preferred provider organization (PPO) plan that pays first, and you get services outside of the plan’s network, Medicare may pay second. You should always check with your employer’s benefits administrator or your insurance company to find out who pays first in your case.

How to Choose Between Medicare and Employer Health Insurance

If you have both Medicare and employer insurance, you may wonder whether you need both types of coverage or whether you can drop one of them. The answer depends on several factors, such as:

·        The cost of each plan’s premiums, deductibles, copayments, coinsurance, and out-of-pocket limits

·        The benefits and services covered by each plan

·        The network of providers available under each plan

·        The quality of care and customer service offered by each plan

·        Your current and future health care needs

Generally speaking, if you have group health plan coverage from a large employer (20 or more employees for those 65 or older, 100 or more employees for those under 65), you may choose to delay enrolling in Medicare Part B (and Part D if you need prescription drug coverage) until you stop working or lose your employer coverage. This way, you can avoid paying Part B premiums while you have other coverage. You will also have a special enrollment period of eight months to sign up for Part B (and Part D) without penalty when your employment or group health plan ends.

However, if you have group health plan coverage from a small employer (less than 20 employees for those 65 or older, less than 100 employees for those under 65), you should enroll in Medicare Part B (and Part D if you need prescription drug coverage) as soon as you become eligible for Medicare. This is because Medicare Plan will be the primary payer and your employer insurance will be the secondary payer. If you do not enroll in Part B, you may have to pay the full cost of your medical bills.

We’re Here to Help

You do not have to spend hours reading articles on the internet to get answers to your Medicare questions. Give the licensed insurance agents at Golden Years Design Benefits a Call at 1-844-254-8998. You will get the answers you seek in a matter of minutes, with no pressure and no sales pitch. We are truly here to help.

FAQS Employer insurance and Medicare

 If I have employer health insurance, do I still need to enroll in Medicare Part B at 65?

A: Yes, you should still sign up for Medicare Part B when you turn 65 even if you have employer coverage. Medicare will be primary.

Can I keep my employer insurance and Medicare benefits? 

 Yes, you can have both employer coverage and Medicare. Medicare may pay secondary if your employer has 20+ employees.

What if my employer has less than 20 employees? 

With fewer than 20 employees, Medicare pays primary and your employer coverage is secondary.

Should I drop my employer coverage when I qualify for Medicare?

You can keep your employer health plan and coordinate it with Medicare. Consider costs before dropping it.

When does Medicare become my primary insurance?

 Medicare is primary when you turn 65 in most cases. If you have employer coverage, rules determine primary vs secondary.

Can I delay Medicare enrollment if I have health insurance from my employer? 

 Yes, you may be able to delay Medicare if you have group health coverage from an employer.

What happens when my employer coverage ends after I am on Medicare?

When employer coverage stops, Medicare will become your primary insurance for hospital and medical benefits. 

 Does my employer size matter for coordinating with Medicare? 

Yes, if your employer has 20+ employees, Medicare may pay secondary to that group health plan coverage.  Speaking with a licensed insurance agent can help you understand how to integrate employer and Medicare coverage.

 Where can I learn more about employer health insurance and Medicare?

 Contact Medicare or the Centers for Medicare & Medicaid Services for guidance on coordinating employer and Medicare health coverage.