what if i have medicare and my employer gives me insurance?

When you have both Medicare and employer coverage, the size of your employer will determine how your Medicare benefits will coordinate with your employer coverage. If you become eligible for Medicare at age 65 while working for an employer with 20 or more employees, your group plan will be primary, and Medicare will be secondary.

Full Answer

Is Medicare better than employer insurance?

Their spouse can stay on their employer’s plan until they become eligible for Medicare, and though there are some exceptions, 65-year-old employees can benefit from both their employer’s plan and their Medicare plan. Contrary to popular belief, Medicare could actually provide better coverage at a lower cost than an employer plan.

How does Medicare work with my current employer insurance?

• You will always have the choice of keeping your employer health insurance when you are eligible for Medicare if you work for a large company
• Depending on the size of your company, Medicare may be your primary or secondary insurance
• Medicare also works with COBRA, TRICARE, VA benefits, and HRAs

Can I buy health insurance if my employer offers it?

Your employer offers health insurance coverage, but it doesn’t contribute enough for the premiums The amount employers subsidize can vary by employer. If your employer doesn’t help much to pay premiums, you might find a better deal by buying an individual health plan, especially if you qualify for subsidies in an ACA plan.

Do I need Medicare if I have insurance?

The vast majority of people receive Part A benefits without paying any premiums at all. Even if you are currently insured, you should go ahead and sign up for Medicare Part A. The standard premium for Medicare Part B, however, is $90.90 per month.

Can you have Medicare and employer insurance at the same time?

Thus, you can keep Medicare and employer coverage. The size of your employer determines whether your coverage will be creditable once you retire and are ready to enroll in Medicare Part B. If your employer has 20 or more employees, Medicare will deem your group coverage creditable.

Is Medicare primary or secondary to employer coverage?

Medicare pays first and your group health plan (retiree) coverage pays second . If the employer has 100 or more employees, then the large group health plan pays first, and Medicare pays second .

Do you get your Medicare taken away if you start working?

During the first 9 months that you work in a rolling 5-year period, you continue to receive full benefits, including Medicare, if the waiting period has passed, regardless of how much you earn, as long as you report your work activity to Social Security and continue to have a disabling impairment.

Can Medicare premiums be reimbursed by employer?

In general, when an employee is eligible for Medicare due to age, an employer may reimburse his or her Medicare premiums only when: The employer's group health plan is a secondary payer to Medicare because the employer has fewer than 20 employees; AND.

Can I keep my private insurance and Medicare?

It is possible to have both private insurance and Medicare at the same time. When you have both, a process called “coordination of benefits” determines which insurance provider pays first. This provider is called the primary payer.

Does Medicare pay copays as secondary insurance?

Medicare will normally act as a primary payer and cover most of your costs once you're enrolled in benefits. Your other health insurance plan will then act as a secondary payer and cover any remaining costs, such as coinsurance or copayments.

Do I automatically get Medicare when I turn 65?

You automatically get Medicare when you turn 65 Part A covers inpatient hospital stays, skilled nursing facility care, hospice care, and some home health care. Part B covers certain doctors' services, outpatient care, medical supplies, and preventive services.

What happens if you don't enroll in Medicare Part A at 65?

If you don't have to pay a Part A premium, you generally don't have to pay a Part A late enrollment penalty. The Part A penalty is 10% added to your monthly premium. You generally pay this extra amount for twice the number of years that you were eligible for Part A but not enrolled.

How does Medicare work when you turn 65?

You can sign up for Part A any time after you turn 65. Your Part A coverage starts 6 months back from when you sign up or when you apply for benefits from Social Security (or the Railroad Retirement Board). Coverage can't start earlier than the month you turned 65.

How do I get my Medicare premium refund?

Call 1-800-MEDICARE (1-800-633-4227) if you think you may be owed a refund on a Medicare premium. Some Medicare Advantage (Medicare Part C) plans reimburse members for the Medicare Part B premium as one of the benefits of the plan. These plans are sometimes called Medicare buy back plans.

Who is eligible for Medicare Part B reimbursement?

1. How do I know if I am eligible for Part B reimbursement? You must be a retired member or qualified survivor who is receiving a pension and is eligible for a health subsidy, and enrolled in both Medicare Parts A and B.

What are Medicare Secondary Payer rules?

The one that pays second (secondary payer) only pays if there are costs the primary insurer didn't cover. The secondary payer (which may be Medicare) may not pay all the remaining costs. If your group health plan or retiree coverage is the secondary payer, you may need to enroll in Medicare Part B before they'll pay.

How long do you have to enroll in Medicare after you retire?

Once you retire and give up your employer health benefits, you will have a special enrollment period of 8 months to enroll in Part A and Part B, if you haven’t enrolled already. This special enrollment period begins the month after your employment or group health plan ends. There is no late enrollment penalty for enrolling in original Medicare ...

How old do you have to be to get Medicare?

Although retirement age usually ranges from 66 to 67 years old, Medicare eligibility for most individuals begins at age 65. Some people who continue to work past age 65 may also have group health plan benefits through their employer. Because of this, it’s possible to have both Medicare and a group health plan after age 65.

How to determine if Medicare is primary or secondary?

Here’s how to know who the primary and secondary payers are in your situation: 1 Medicare is generally the primary payer if the company you work for has fewer than 20 employees. But Medicare becomes the secondary payer if your employer is part of a group health plan with other employers who have more than 20 employees. 2 Medicare is typically the secondary payer if the company you work for has 20 or more employees. In this case, your group health plan is the primary payer and Medicare pays out only after your employer’s plan has paid their portion.

What is the number to call Medicare?

If you’re not sure whether Medicare will be the primary or secondary payer in your situation, you can call 855-798-2627 to speak to someone at Medicare’s Benefits Coordination & Recovery Center.

Does Medicare cover dependents?

Medicare is individual health insurance coverage, which means that it doesn’t include coverage for spouses or dependents. Most group health plans, on the other hand, do include some sort of coverage option for dependents and spouses.

Does Medicare work with employer benefits?

Instead, they can work in conjunction. Medicare is meant to work together with employer benefits to cover your healthcare needs and help pay for most, if not all, of your medical expenses.

Is Medicare the primary or secondary payer?

Medicare is typically the secondary payer if the company you work for has 20 or more employees.

How to choose between Medicare and employer coverage?

Choosing between Medicare and employer coverage. If you are eligible for both Medicare and employer coverage, you will generally have three options: Keep both types of coverage. Drop your employer coverage and just have Medicare. Delay Medicare enrollment and just have employer coverage.

How long do you have to enroll in Medicare?

When your employer coverage does finally end, you will be given eight months to enroll in Medicare Part A and Part B, and you’ll have 63 days to enroll in a Medicare Advantage plan before facing any late enrollment penalties.

How old do you have to be to be on Medicare?

Being under 65 years old with a disability. If you are under 65 but are enrolled in Medicare because of a disability and are also covered by an employer health plan, the employer will serve as the primary payer if it has more than 100 employees. With fewer than 100 employees, Medicare becomes the primary payer.

What is Medicare payer?

When enrolled in both Medicare and employer insurance, each type of coverage is called a “ payer .”. Which type of coverage pays first depends largely on the size of your employer.

Can you keep Medicare and Cobra?

If you are first enrolled in Medicare and then become eligible for COBRA, you may keep both types of coverage . Medicare will serve as the primary payer, and COBRA will act as the secondary payer.

Is Medicare a primary or secondary payer?

Medicare acts as the secondary payer. Medicare categorizes a company of fewer than 20 employees as “small.”. If you are an active employee at a small company, Medicare will be the primary payer. Any employer coverage you receive will be the secondary payer.

Is tricare a primary payer?

TRICARE. For active military members with TRICARE, TRICARE works as the primary payer, and Medicare is the secondary payer. Retired members of the military who receive TRICARE for Life are required to enroll in Medicare Part B if eligible, and Medicare will serve as their primary payer. Veterans Affairs (VA)

What happens if you leave Medicare without a creditable coverage letter?

Without creditable coverage during the time you’ve been Medicare-eligible, you’ll incur late enrollment penalties. When you leave your group health coverage, the insurance carrier will mail you a creditable coverage letter. You’ll need to show this letter to Medicare to protect yourself from late penalties.

What happens if you don't have Part B insurance?

If you don’t, your employer’s group plan can refuse to pay your claims. Your insurance might cover claims even if you don’t have Part B, but we always recommend enrolling in Part B. Your carrier can change that at any time, with no warning, leaving you responsible for outpatient costs.

What is a Health Reimbursement Account?

Beneficiaries who participate can get tax-free reimbursements, including their Part B premium. A Health Reimbursement Account is a well-known Section 105 plan. An HRA reimburses eligible employees for their premiums, as well as other medical costs.

Is Medicare billed first or second?

If your employer has fewer than 20 employees, then Medicare becomes primary. This means Medicare is billed first, and your employer plan will be billed second. If you have small group insurance, it’s HIGHLY recommended that you enroll in both Parts A and B as soon as you’re eligible. If you don’t, your employer’s group plan can refuse ...

Is a $4,000 hospital deductible a creditable plan?

For your outpatient and medication insurance, a plan from an employer with over 20 employees is creditable coverage. This safeguards you from having to pay late enrollment penalties for Part B and Part D, ...

Can employers contribute to Medicare premiums?

Medicare Premiums and Employer Contributions. Per CMS, it’s illegal for employers to contribute to Medica re premiums. The exception is employers who set up a 105 Reimbursement Plan for all employees. The reimbursement plan deducts money from the employees’ salaries to buy individual insurance policies.

How does Medicare work with other insurance?

When there's more than one payer, "coordination of benefits" rules decide which one pays first. The "primary payer" pays what it owes on your bills first, and then sends the rest to the "secondary payer" (supplemental payer) ...

How many employees does a spouse have to have to be on Medicare?

Your spouse’s employer must have 20 or more employees, unless the employer has less than 20 employees, but is part of a multi-employer plan or multiple employer plan. If the group health plan didn’t pay all of your bill, the doctor or health care provider should send the bill to Medicare for secondary payment.

How long does it take for Medicare to pay a claim?

If the insurance company doesn't pay the claim promptly (usually within 120 days), your doctor or other provider may bill Medicare. Medicare may make a conditional payment to pay the bill, and then later recover any payments the primary payer should have made. If Medicare makes a. conditional payment.

What is a group health plan?

If the. group health plan. In general, a health plan offered by an employer or employee organization that provides health coverage to employees and their families.

When does Medicare pay for COBRA?

When you’re eligible for or entitled to Medicare due to End-Stage Renal Disease (ESRD), during a coordination period of up to 30 months, COBRA pays first. Medicare pays second, to the extent COBRA coverage overlaps the first 30 months of Medicare eligibility or entitlement based on ESRD.

What is the phone number for Medicare?

It may include the rules about who pays first. You can also call the Benefits Coordination & Recovery Center (BCRC) at 1-855-798-2627 (TTY: 1-855-797-2627).

What happens when there is more than one payer?

When there's more than one payer, "coordination of benefits" rules decide which one pays first. The "primary payer" pays what it owes on your bills first, and then sends the rest to the "secondary payer" (supplemental payer) to pay. In some rare cases, there may also be a third payer.

How long do you have to sign up for Medicare if you leave your job?

When you do leave your job, you should qualify for a special enrollment period. At this point, you will have eight months to sign up for Medicare Part B without having to pay a late penalty in the form of a higher premium. Some employers have different policies regarding how insurance works for employees over 65.

When do you have to enroll in Medicare Part B?

If you work for a business with less than 20 people, your employer may require you to enroll in Medicare Part B at age 65. Talk to your employer to learn more about your options.

What percentage of coinsurance is paid by a secondary insurer?

For example, a secondary insurer could pay the 20 percent coinsurance on a service covered by Original Medicare. If you have secondary insurance and do not have primary insurance, you risk having very little coverage for necessary medical services.

When does group insurance become primary?

After age 65, your group insurance can either become your primary or secondary insurer. Whichever it becomes can be based on your company’s size or other factors. If your group plan remains your primary insurer, your existing coverage will continue to pay for its benefits, as it would normally. If your employer has coverage ...

Can an employer require you to have a different kind of insurance?

Your employer cannot require you to get on a different kind of insurance (like by offering to pay for you Medicare Supplement Insurance or Medicare Advantage Premiums, for example). Your employer cannot offer you a different kind of insurance than people younger than you.

Can an employer require you to have health insurance after 65?

What Your Employer Cannot Do. When it comes to keeping health insurance from your employer after age 65, you have rights. Rules regarding health insurance past 65 aren’t always black and white, but the list below are some examples of actions your employer cannot do once you become eligible for Medicare. Your employer cannot require you ...

What happens if you don't have creditable Medicare?

There are penalties that may accrue if you do not have “creditable coverage”. You may have to pay a cost for the rest of your Medicare life. 4. Learn about your state’s rules on leaving employer coverage voluntarily. Every state has different rules that apply to leaving employer coverage. In some states, you are afforded guaranteed Issue rights ...

How are Medicare Part B premiums determined?

Medicare Part B premiums are determined by level of income. Knowing this amount is critical in deciding between employer coverage and Medicare. Part D prescription premiums may be increased due to income, so be sure to know what that premium level will be if you enroll for Medicare.

Can you leave your employer's coverage?

Every state has different rules that apply to leaving employer coverage. In some states, you are afforded guaranteed Issue rights whether your coverage ended voluntarily or not. This is especially critical for those people with a chronic illness who wish to purchase a Medicare Supplement.

Is Medicare retiring?

Researcher & Writer. December 10, 2019. More and more frequently, Americans who become eligible for Medicare are not retiring. If you become eligible for Medicare and still plan on working, you will have to decide whether it is better to remain on your employer’s coverage or enroll in Medicare. Unfortunately, this is not a black and white issue.

Is employer health insurance creditable?

Find out if your employer health insurance is creditable. When deciding between group coverage or Medicare, it is important to know whether or not your employer insurance qualifies as “ creditable coverage”. Your Human Resource director or plan administrator should know. There are penalties that may accrue if you do not have “creditable coverage”.

Do employees carry a larger portion of insurance premium?

Employees are now required to carry a bigger and bigger portion of the premium. It is important to not only know the employee portion of premium, but all other relevant costs like deductibles, coinsurance, and Maximum-Out-of-Pocket (MOOP).

Is employer prescription coverage better than Medicare?

Currently employer prescription coverage is typically better than what an individual can get from Medicare. The formularies are usually broader and the copays are typically lower. Since prescriptions can be one of the biggest costs for those on Medicare, verifying drug costs could save you a lot of money in the long run.

What factors affect your Medicare enrollment status if you are working?

Medicare is the federal health insurance program that covers people age 65 and older as well as some younger people with disabilities or specific health conditions. If you’re still working at 65 and covered by your employer plan, several factors will affect your Medicare enrollment status:

Is Medicare enrollment required for people who are still working?

It depends. As mentioned above, if you work for a company with fewer than 20 people, you’ll be expected to sign up for Medicare ( including Part D) as soon as your initial enrollment period rolls around. That period begins 3 months before your 65th birthday and continues for 3 months after the month you turn 65.

What are the benefits of getting Medicare while I am working?

If you’re unhappy with your current insurance, you might prefer the Medicare coverage. For example, your private health insurance may restrict you to a small network of doctors, while 99% of nonpediatric physicians accept Medicare. Switching to Medicare may also save you money on out-of-pocket costs versus your existing plan.

What are the drawbacks of getting Medicare while still working?

While Medicare Part A is free, Medicare Part B — which covers doctor visits and outpatient medical supplies — requires you to pay a monthly premium (in 2021, the premium is $148.50 per month for most enrollees; high earners may pay more).

How do I decide which approach is the most cost-effective for me?

When you have access to both an employer-based plan and Medicare, deciding on the most cost-effective approach to building insurance coverage takes a bit of work. To start, add up each plan’s out-of-pocket costs, including its premiums, deductibles, copays, and prescription drug costs.

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Navigating Medicare can be challenging, especially since different types of coverage won’t necessarily cover all of your expenses. Choosing to purchase additional coverage may help. Find out which supplemental coverage option is best for you, Medicare Advantage or Original Medicare with Medigap.

The bottom line

You can use Medicare while you’re still working. If you work for a large employer, the decision is typically up to you. To decide on the right approach, you’ll need to consider both plans’ costs and coverage.

Are Part B and Part D Optional?

Avoiding Late Enrollment Penalties with Medicare & Employer Coverage

Employer Contributions and HSAs

• Although many employer health plans have the monthly premium automatically deducted from your paycheck, it is illegal for your employer to pay your Medicare premium(s) for you. But there are some exceptions, starting with a 105 Reimbursement Plan. This plan lets employers repay their employees for the exact cost of their Medicare premiums. And best...

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