If beneficiaries are working and have health insurance through their employers, do they need to take Medicare Parts A and B? What insurance is primary? Will there be a late penalty for not enrolling?

Beneficiaries who are working or are covered through a spouse's active employment covered under an employer group health plan can put off getting Medicare and will not be penalized for late enrollment.

Medicare will pay secondary benefits to supplement the primary benefits paid by the group health plan if that plan pays only a portion of the services up to the Medicare covered rate and if the plan covers enough people.

Individuals who have premium-free Part A may benefit from keeping Part A since there is no cost to them on a monthly basis. Part A hospital coverage will be secondary to the employer group health plan and may extend employer-based coverage when it has annual or lifetime payment caps, or when coverage for home healthcare or hospice care is limited.  Keep in mind that there is no co-pay for Medicare's home health coverage and that there's no set limit on the number of covered visits. There is no need to enroll in Part B or Premium Part A and pay for it if the benefits are not needed. Individuals may wish to refuse Part B since there is a monthly premium and the coverage is likely to be duplicative of the employer-based coverage. Be sure to decline Part B in writing.

A Special Enrollment Period (SEP) is an enrollment period for individuals who delay enrolling in Part B or Premium Part A because they are covered by an employer group health plan.  Once an individual stops working, they can enroll in Medicare Part B for the next eight (8) months without penalty. During this special enrollment period (SEP), the individual may have to fill out, and have their former employer sign, a Social Security form stating the dates of prior coverage by their employer group health plan.

Note: If both spouses are retired but still covered by the group plan, they will likely be assessed a premium penalty if they decide to take Medicare Premium Part A and Part B at a later date. This answer refers to employer group health coverage when an individual or spouse is actively working.

HAP Tool for More Information:  http://www.hapnetwork.org/assets/pdfs/medicare-secondary-payer-rules-final.pdf

Source: 42 C.F.R. §411, et. seq. http://www.access.gpo.gov/nara/cfr/waisidx_05/42cfr411_05.html

(Back to Original Medicare: Enrollment)