Whether you work at age 65 or not, you will still be eligible for Medicare coverage. However, registration for Medicare is not compulsory. In fact, you may prefer to stick to health care coverage offered by your company instead. However, with the choice of not signing up as you become eligible comes a penalty.

Indeed, everyone’s preferences vary. However, the wise decision is to consider the size of your organization and the value you get from your workplace health coverage before finally deciding whether to sign up for Medicare or not. 

Here’s more about Medicare sign-up and non-retirement.

Part A

Part A is the portion of Medicare that covers the hospital coverage. This includes services such as:

If you qualify for Medicare Part A, there is minimal downside associated with its enrollment. In addition, you may easily become eligible for Part A if you have paid into Medicare through payroll taxes for at least ten years of employment.

If you work for a large employer with more than 20 employees, a Medicare policy can act as a secondary payer and help fill gaps in your current coverage at no additional cost on your end.

Enrolling in Medicare can help reduce your medical costs if you work for a small organization (less than 20 employees) or have an employer’s health insurance plan with less coverage.

In these cases, Medicare is often the primary payer and may provide better coverage than you currently receive. In fact, your small firm’s insurance may not cover you if they find that you are eligible for Medicare benefits and haven’t enrolled.

In many cases, it is better to apply for Medicare Part A when you become eligible, even if a group health plan covers you. It is because the delay in Part A registration may result in a penalty when you enroll in the future.

Part B

Medicare Part B is the portion of Medicare that provides medical insurance. In addition, you can use it to cover various outpatient services, such as:

Medicare usually provides seven months around your eligibility date to apply. This is called your Initial Enrollment Period (IEP). For instance, you can apply for three months before your 65th birthday, during your birthday, and three months after that.

In many cases, you’ll need to register on time to avoid paying the late enrollment penalty for your Medicare Part B premiums. However, you may qualify for an 8-month Special Enrollment Period (SEP) if you or your spouse is employed when you become eligible. 

You can retain your existing group health plan for as long as possible during a Special Enrollment Period. In the case of leaving that employer or the employer terminates your coverage, you get an eight-month window to enroll in Medicare without paying any late penalties.

Notably, the monthly premium for 2020 was $145. In 2021, it is $148.50 if you make up to $87,000 as a single income tax filer. Thus, premiums increase in tiers at higher income levels.

However, you should make sure that your workplace coverage meets the IRS definition of group coverage. You will want to get a written answer from your employer. If not, you should register in Part B to avoid paying the premium penalty levied for not registering in Part B within eight months of becoming eligible.

Notably, you can’t contribute to a health savings account after you enroll in Medicare.

Unless you’re claiming Social Security benefits, you won’t automatically be enrolled in Medicare at age 65. But since you haven’t retired yet, you may not be claiming those benefits, and you’ll need to proactively choose which parts of Medicare you want to enroll in and when.

The people who have paid Medicare taxes throughout their working years can enroll in Part A free of cost; it usually makes sense to enroll, even if you have good health insurance through work. However, the decision to register in Part B and D is less straightforward, and you need to know whether your workplace insurance meets specific requirements before proceeding.