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Reaching Medicare Eligibility: What if You’re Still Employed?

After several decades of working, raising families, and planning for retirement, it used to be that most American workers aimed to retire by age 65. This was due mostly to two factors: Medicare eligibility begins at 65, and workers once reached “full retirement age”, according to Social Security, at 65. This was the age at which they could claim full benefits.

Now, that full retirement age has been raised to 66, or even 67, depending upon your year of birth. Yet, the age of Medicare eligibility remains the same. In fact, you’re actually required to sign up for Medicare at this time, or else face higher penalties when you do eventually enroll later.

The changes within Social Security, along with many other societal changes affecting retirement, have spurred many would-be retirees to keep working another year or two (or longer). So what do they do about their Medicare benefits, if they’re already covered by an employer’s group health insurance policy?

Medicare Part A. Medicare Part A covers hospitalization, and premiums are free for most people once they reach age 65 and enroll. So, in most cases, it makes sense to go ahead and claim these benefits. Talk to your employer’s healthcare plan administrator, and ask them how enrolling in Medicare Part A will affect your current health insurance plan. In some cases there is a conflict, such as when your employer utilizes a Health Savings Account to cover your insurance premiums, but in most cases Part A simply helps you pay your hospitalization bills.

Part B. Medicare Part B, or the part that covers doctor visits and inpatient treatments, can be a bit more complicated. Once you enroll, you will be paying a monthly premium, while the insurance offers little benefit to those who already acquire these services through a group health insurance plan. So, it might be a waste of money. On the other hand, Medicare Part B might offer a terrific value to those who are self employed, or work for a small employer with fewer than 20 full-time employees.

Ask for guidance. Seek expert guidance, and we can help you sort out the differences between both insurance scenarios.