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If you’re still working at 65, you have a decision to make: Do you stick with your employer’s health insurance or make the jump to Medicare?
The answer here depends on the size of your employer, whether you qualify for free Medicare Part A and whether you’re contributing to a health savings account (HSA).
- If your employer has 20+ employees: You can usually delay signing up for Medicare to save money on premiums. (Most people still join Part A if it’s free.)
- If your employer has <20 employees: You typically need to sign up for Medicare now to avoid penalties and coverage gaps.
- If you have a health savings account (HSA): Don’t enroll in Medicare yet. You’ll need to stop your contributions first to avoid tax penalties.
A note for married couples: If you're covered by your spouse's employer insurance, this information also applies to you when you turn 65.
Should I sign up for Medicare if my employer has 20+ employees?
If your or your spouse's employer has 20 or more employees and a group health plan, you don't have to sign up for Medicare at 65. But you may want to sign up for certain parts of Medicare.
- Part A: If you get Medicare Part A for free, it’s worth signing up now, unless you want to continue contributing to an HSA. In some cases, Medicare Part A may cover what your employer plan doesn’t.
- Part B: You will probably want to delay enrolling in Medicare Part B unless the coverage is better and cheaper than what you’re receiving through employer insurance. Everyone pays a premium for Part B, which is $202.90 per month in 2026.
- Part D: You can also delay enrolling in Medicare Part D as long as you have creditable coverage, meaning your coverage is at least as good as the benefits provided by Medicare Part D plans. Once you’re eligible for Medicare, your current drug plan should send you an annual notice letting you know whether your coverage is creditable.
There are permanent penalties if you go too long without coverage, so you’ll want to sign up for Medicare at least a month before you stop working or lose coverage.
» MORE: When does Medicare start?
Shopping for Medicare plans? We have you covered.
Medicare Advantage is an alternative to traditional Medicare offered by private health insurers. It covers the same benefits as Medicare Part A and Part B.
- States available48 states and Washington, D.C.
- Members in high-rated plansMedium (50% to 84%)
- Member satisfactionAverage
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- States available46 states and Washington, D.C.
- Members in high-rated plansLow (49% or less)
- Member satisfactionAbove average
(855) 432-0512 / TTY 711
M-F 9AM-9PM, Sat 10AM-6PM ET
Speak to a licensed insurance agent on askchapter.org
Get a quote
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Should I sign up for Medicare if I work for a small business with under 20 employees?
If your or your spouse's employer has fewer than 20 employees, you typically must enroll in Medicare Part A and Part B at age 65.
Medicare will act as your primary insurance. “Primary” means that Medicare pays first, then the employer insurance kicks in to pay whatever might be covered under that policy but wasn't covered by Part A. Your employer insurance can refuse to pay for services if you don’t have Medicare.
If your employer participates in a multi-employer group plan, you may be able to wait to sign up for Medicare until you or your spouse stops working or loses coverage. Confirm with your benefits advisor that your employer plan will act as primary insurance after you turn 65.
You can wait to sign up for Medicare Part D if you have acceptable drug coverage through your employer or elsewhere. Just make sure to sign up as soon as you lose coverage or leave your job.
Should I sign up for Medicare if I have an HSA?
Medicare enrollees can't contribute to an HSA. If you're saving to an HSA and want to keep doing so, you must delay enrollment in Medicare. To avoid a tax penalty, you should plan to stop making HSA contributions at least six months before signing up for Medicare if you enroll after age 65. This is because your Medicare Part A coverage starts six months before your sign up date if you delay Medicare enrollment.
» MORE: HSAs and Medicare
Nerdy Perspective
Is it a good idea to get Medicare if you're still working at 65?
It often makes sense to get Medicare Part A when you turn 65, because it's free for most people. You can delay signing up for the other parts of Medicare, as long as you've confirmed you have adequate coverage through your employer.
However, if your employer coverage requires you to pay a big portion of the premium, you might find that Medicare is cheaper. Make sure to compare your current coverage and out-of-pocket expenses — including premiums, deductibles, copays and coinsurance — with your benefits and costs under Medicare.
However, if your employer coverage requires you to pay a big portion of the premium, you might find that Medicare is cheaper. Make sure to compare your current coverage and out-of-pocket expenses — including premiums, deductibles, copays and coinsurance — with your benefits and costs under Medicare.
lead writer covering Medicare
How much does Medicare cost if you're still working?
If you reach 65 and you’ve worked a total of approximately 10 years over your career, you’re entitled to premium-free Medicare Part A, which is your hospital insurance. Medicare Part B, which pays for doctor visits and many other outpatient services, requires a monthly premium of $202.90 per month in 2026. Medicare Part D is prescription drug coverage, and the average total monthly premium is $34.50 in 2026.
The Medicare special enrollment period
When you stop working or lose your employer coverage, you’re granted a special enrollment period (SEP) to sign up for Medicare without penalty. Once the clock starts ticking, you have:
- Eight months to sign up for Medicare Part A and Part B.
- 63 days to sign up for Medicare Part D.
COBRA and retiree coverage don’t count as employer insurance. Your window to sign up starts when your job ends.
Medicare late enrollment penalties
Delaying enrollment for Medicare can have permanent consequences if you make a mistake. Here’s why it’s important to get it right:
| If you miss this deadline... | You will pay this penalty: |
|---|---|
| Part A | 10% premium increase for twice the number of years you were late. |
| Part B | 10% increase for every 12-month period delayed. This penalty is for life. |
| Part D | Permanent monthly penalty based on how long you went without drug coverage. |
Special situations: Previous employers, military and vets
If you have health insurance from a previous employer, such as your or your spouse’s COBRA or retiree health coverage, you need to enroll in Medicare Parts A and B when you turn 65.
If you have health benefits as a military service member or veteran, such as TRICARE or CHAMPVA, you should consult with those programs to determine when to enroll in Medicare.
Next Steps
Your Medicare transition checklist
If you’re turning 65 and still working with employer health coverage, use this list to stay on track and avoid penalties:
Consult your HR benefits administrator. Before delaying Medicare, make sure you’ll have adequate coverage through your employer after turning 65.
Set a deadline to sign up for Medicare. If you decide to delay any part of Medicare, mark your calendar with a reminder to sign up when you stop working or lose coverage.
Check your health savings account. If you plan to delay Medicare, mark your calendar with a “stop date” for HSA contributions at least six months before you plan to sign up.
» MORE: How Do I Sign Up for Medicare?
