Employers with Less than 20 Employees
Medicare and Employers with Fewer than 20 Employees
As you approach your 65th birthday, it’s important to understand how your employer size impacts your Medicare requirements. If your employer has fewer than 20 employees, Medicare rules require you to enroll in Parts A and B when turning 65. This is due to Medicare’s Secondary Payer Rules.
What Are Medicare’s Secondary Payer Rules?
When you turn 65 and work for a small employer (fewer than 20 employees), Medicare can become the primary payer of your medical claims. Your employer group health plan can become the secondary payer, which means your group plan will pay after Medicare has paid.
Why Is It So Important to Enroll in Medicare Parts A and B?
If you delay Medicare enrollment and remain on your employer plan, you may find yourself in a costly situation. All small employer plans will not pay claims as primary coverage for someone eligible for Medicare. Instead, they will only cover what Medicare would have paid, or nothing at all, leaving you responsible for the balance.
Example:
You’re 65, still working, and have group coverage through an employer with 15 employees.
You receive a bill for $10,000 for medical care.
If enrolled in Medicare:
Medicare pays $8,000.
Your employer plan might cover all or part of the remaining $2,000.If NOT enrolled in Medicare:
You could be exposed to as much as $8,000.
Your employer plan might cover all or part of $2,000.
When Should You Enroll in Medicare Parts A and B?
We recommend enrolling during your Initial Enrollment Period (IEP), which is the 7-month window around your 65th birthday:
3 months before your birthday
The month of your birthday
3 months after your birthday
However, to avoid any problems, we recommend applying during the 3 months prior to your 65th birth month.
How to Apply for Medicare Parts A and B
If You’re Receiving Social Security Benefits Before Age 65
You’ll be automatically enrolled in Medicare Parts A and B.
Your coverage will begin on the 1st of your 65th birth month.
Your Medicare card will arrive by mail.
If You Are NOT Receiving SSI Benefits Before Turning 65
You must apply for Medicare A and B.
There are four ways to apply for Medicare Parts A and B when turning 65:
- Online: Apply online by logging into your www.ssa.gov account and completing your application.
- In Person: Apply in person at your local SSA office. We recommend you call your local office 3 months before your 65th birthday and make an appointment to complete your application.
- By Phone: Call the national SSA office at 800-772-1213 to schedule a phone enrollment. Note: Appointments may be scheduled 30+ days out, and final processing can take another 30–60 days. This may delay your ability to enroll in your supplemental plans.
- By Mail or Fax:
If mailing your application, we strongly recommend using tracking or delivery confirmation to ensure it’s received.
What Do You Do After You Apply?
Once you’ve submitted your application for Medicare Parts A and B, your next step is to evaluate your Medicare plan options. Your options include Medicare Supplement, Medicare Advantage, and Part D prescription drug plan.
We recommend scheduling a consultation with your licensed Insurance Masterminds agent, who can walk you through your choices and help you find the plan that fits your needs and budget.
Schedule a meeting today here.
