Turning 65 but Still Working? Here's What You Need to Know About Medicare

Many people assume they'll be retired by the time they turn 65 and become eligible for Medicare. In reality, thousands of Americans continue working well beyond age 65, making Medicare decisions a little more complicated.

If you or your spouse are still employed and covered by an employer-sponsored health plan, understanding how Medicare works alongside your current coverage can help you avoid costly mistakes.

Your Initial Enrollment Period (IEP)

Your Initial Enrollment Period lasts 7 months:

• 3 months before your 65th birthday

• Your birthday month

• 3 months after your birthday

During this time, you're first eligible to enroll in Medicare. However, if you have creditable employer coverage, you may be able to delay enrollment without penalties.

Is Your Employer Insurance or Medicare Primary?

The size of your employer matters.

If your employer has 20 or more employees:

• Your employer health plan is generally your primary insurance.

• Medicare is typically secondary.

If your employer has fewer than 20 employees:

• Medicare generally becomes your primary insurance.

• Your employer coverage pays second.

Always confirm how your employer coverage coordinates with Medicare before making any decisions.

Can You Delay Medicare?

If you're covered under a creditable employer-sponsored health plan through your own or your spouse's current employment, you may be able to delay enrolling in Medicare Part B without a late enrollment penalty.

However, if you contribute to a Health Savings Account (HSA), enrolling in any part of Medicare means you can no longer make HSA contributions.

Who Qualifies for Medicare?

Generally, you qualify for premium-free Medicare Part A if you:

• Worked and paid Medicare taxes for at least 10 years (40 quarters), or

• Qualify through your spouse's work history (if your spouse worked 40 quarters and is at least age 62)

You must also be:

• A U.S. citizen, or

• A lawful permanent resident who has lived continuously in the United States for at least five years.

What Happens When You Retire?

Once your employment or employer-sponsored coverage ends (whichever happens first), you'll typically receive an 8-month Special Enrollment Period to enroll in Medicare Part B.

If you miss this window, you may have to wait for the General Enrollment Period (January 1–March 31), with coverage beginning later in the year. You could also face a permanent late enrollment penalty if you weren't covered by creditable insurance.

Important Note About COBRA

Choosing COBRA after leaving your job does not extend your Special Enrollment Period for Medicare.

If you delay enrolling in Medicare because you're on COBRA, you could face delayed coverage and late enrollment penalties.

Medicare and Income

You may enroll in Medicare while still working if it makes sense for your situation.

Keep in mind that Medicare Part B and Part D premiums may be higher for individuals with higher incomes. This additional cost is called the Income-Related Monthly Adjustment Amount (IRMAA) and is based on your income from approximately two years earlier.

Why Some People Wait to Enroll

Everyone's situation is different. Delaying Medicare may make sense if:

• You have comprehensive employer-sponsored coverage.

• Your spouse still relies on your employer health plan.

• You want to continue contributing to a Health Savings Account (HSA).

• You're delaying retirement to maximize your Social Security benefits.

• Your employer plan offers prescription drug coverage or benefits that better meet your current needs.

The Bottom Line

Turning 65 doesn't automatically mean you need to enroll in every part of Medicare. If you're still working, your employer coverage, company size, HSA contributions, and retirement timeline all play a role in determining the best path forward.

Before making any decisions, review your employer benefits and speak with a licensed insurance agent to understand how Medicare fits into your overall retirement and healthcare strategy.