Fair Square Medicare Wordmark

How Your Employer Insurance and Medicare Work Together

senior gentleman wearing a suit working on his laptop outside of his office stock photo
By Daniel Petkevich
Sep 27, 2022

A guide for when to delay Medicare enrollment and how you are covered

Are you turning 65 soon with no plans to end your career? If so, you are not alone. The average age of retirement dipped during the Great Resignation in 2020. But now the age of retirement is

starting to climb north of 65 again

as people are working longer to secure their nest egg. Let’s walk through how your employer insurance will coordinate with Medicare. 

Stay Up to Date on Medicare!

Join the Fair Square Medicare Newsletter to stay informed on cost savings, changes to Medicare, and other valuable healthcare information.

First Things First

If you are looking for a deep dive on

creditable coverage, check out our article here

. Your private insurance coverage is creditable if you work for a company with at least 20 employees. When weighing your options, your first question should be the size of your company. If you work somewhere with less than 20 employees, it’s important to ask your HR representative if your insurance is creditable. If you don’t have creditable coverage, you should apply for Medicare Part A and Part B. The same goes for if this is your

spouse's employer insurance.

Primary vs. Secondary

Once you’ve answered the first question, consider whether your insurance will pay primary or secondary. 
If your private insurance is paying primary to Medicare, Medicare pays secondary and is supplementing your employer insurance. For whatever healthcare costs pop up, your insurance takes the first swing, and if anything is leftover, Medicare comes in to cover the rest. Remember that Medicare will only pay for things covered by Medicare.
If Medicare pays primary, your employer health insurance pays secondary and is left to cover whatever Medicare will not.  
When your company has 20 or more employees, that’s considered a Group Health Plan (GHP), and your insurance will pay primary. In a Small Group Health Plan (SGHP) with less than 20 employees, your insurance will pay secondary to Medicare, so you need to sign up for Parts A, B, and likely D if Medicare is meant to pay primary.
Note: If you are under 65 and eligible for Medicare due to a disability, the number used to determine primary vs. secondary coverage jumps up to 100 employees. A plan with over 100 employees is considered a Large Group Health Plan (LGHP).
The way your Medicare plan and your GHP might work together to share costs is called the Coordination of Benefits. There are systems in place that work to ensure your healthcare claims are being billed in the right order, but it’s still important for you to know how to apply these rules to your situation in case any claims are disputed. If you have any questions about the Coordination of Benefits for your situation, you can call us at 1-888-376-2028, and you can also call the Benefits Coordination and Recovery Center (BCRC) at 1-855-798-2627.


One question that we hear a lot is whether or not you have to drop your employer’s insurance plan now that you’re turning 65 and are eligible for Medicare. The answer is no, if you have creditable coverage. And further, your employer can’t pay you less, take away your insurance, or discriminate at all just because you are now eligible for Medicare. Unfortunately, these same protections are not in place if you are part of a Small Group Health Plan.

Delaying Medicare Enrollment

The next question on your mind might be how long you should delay Medicare coverage? 
If you don’t have creditable coverage the answer is straightforward. Not only is it within your best interest to enroll in Medicare for the sake of insurance purposes, but you may also incur late enrollment penalties if you aren’t enrolled in Part B and Part D as soon as you’re eligible. Sign up for Medicare the first chance you get. Late enrollment penalties may stick with you for life, so best to avoid them. The Part B late enrollment penalty is 10% of your premium for each year you qualified but didn’t have coverage. The Part D late enrollment penalty is 1% for each month you didn’t have coverage after qualifying (or going 63 days without creditable drug coverage). 
Assuming you have creditable coverage, you will have a special enrollment period (SEP) for 6 months after you lose coverage. That means you can enroll in Medicare after your Initial Enrollment Period without facing any late enrollment penalties for Part B and/or Part D. There are more factors to weigh. You want to run a cost-benefit analysis as it relates to your specific healthcare situation. Our agents are happy to talk you through your options. But for now, here’s where your analysis might begin:
  • Would switching to Medicare save you money?
  • Where does your coverage overlap?
    • If you want to keep your GHP, is the secondary coverage worth it?
    • What does your current insurance not cover that Medicare might? Or vice versa?
    • If you’ve delayed enrolling and contribute to an HSA within 6 months of your Medicare enrollment, you might face a tax penalty.
    • If you’re enrolling once you turn 65, you need to stop making contributions a month before your start date.
One example of delaying Medicare enrollment being necessary for one of our clients involved the cost of their prescription. Their cancer treatment medication was covered by their employer’s insurance and would have been covered under Part D. Because it was a specialty drug classification under Part D plan, this drug would have ended up costing them over $10,000 a year. In this instance, they might need to stay on their GHP until

2024, when the catastrophic coverage phase of Part D drug coverage is phased out, and the maximum out of pocket costs per year is capped around $3250.

Retirement Plans and COBRA Pay Secondary

  • If you’re signed up for COBRA coverage, you should sign up for Medicare as soon as you’re eligible. You will not get a special enrollment period at the end of your COBRA, and may be subject to late enrollment penalties.
    • Medicare pays primary to COBRA.
    • If your COBRA includes creditable drug coverage, you have a special enrollment period of 63 days after your coverage ends.
  • Medicare also pays primary to retirement plans. 
    • If you’ve got a retirement plan, your spouse’s GHP, and Medicare, it pays
      • 1. GHP
      • 2. Medicare
      • 3. Retirement Plan
    • If your retirement plan includes creditable drug coverage, you have a special enrollment period of 63 days after your coverage ends.


If you don’t have creditable coverage, you should sign up for Medicare as soon as you are eligible to avoid any lapses in coverage and late enrollment penalties. If you have insurance that pays primary to Medicare, you have different factors to think through when enrolling in Medicare.

Our team of experts is ready to help you figure out what suits your situation best

. Call us at 1-888-376-2028.

Stay Up to Date on Medicare!

Join the Fair Square Medicare Newsletter to stay informed on cost savings, changes to Medicare, and other valuable healthcare information.

Recommended Articles

Cover image
What Is a Medicare Supplement SELECT Plan?
Apr 25, 2023
Senior man receiving care from an optometrist stock photo
Does Medicare Cover Cataract Surgery?
Dec 22, 2022
Medicare Explained Thumbnail
Medicare Explained
Jan 3, 2022
Cover image
What Is a Medicare Advantage POS Plan?
May 10, 2023
Medicare Enrollment Periods stock image
Explaining the Different Enrollment Periods for Medicare
Feb 3, 2023
cartoon hospital and male doctor stock image
Can I Have Two Primary Care Physicians?
Oct 3, 2022
air purifier stock image
Does Medicare Cover Air Purifiers?
Nov 18, 2022
a variety of pills in a daily pill organizer stock image
Does Medicare Cover Vitamins?
Dec 5, 2022
Mouth guard used to help treat sleep apnea
Does Medicare Cover Mouth Guards for Sleep Apnea?
Dec 8, 2022
Cover image
The Fair Square Bulletin: September 2023
Sep 19, 2023
An illustrated image of a cartoon man using giant scissors to cut the "T" in the word "Tax"
How to Deduct Medicare Expenses from Your Taxes
Dec 28, 2022
senior man holding up his medicare card stock photo
Everything About Your Medicare Card + Medicare Number
May 12, 2022
Doctor physician consulting with male patients in hospital exam room stock photo
Is PAE Covered by Medicare?
Nov 23, 2022
Senior couple going over their finances in front of a computer stock image
How Much Does Medicare Part B Cost in 2023?
Dec 27, 2022
Senior woman checking blood pressure/heart rate at home stock photo
Does Medicare Cover Home Heart Monitors?
Dec 1, 2022
Senior person holding tissue roll near a toilet bowl, using walker to walk to the bathroom stock photo
Is Emsella Covered by Medicare?
Nov 21, 2022
Cover image
Does Medicare Cover RSV Vaccines?
Sep 13, 2023
Acute psoriasis on elbows is an autoimmune incurable dermatological skin disease stock photo
Does Medicare Cover Light Therapy for Psoriasis?
Jan 17, 2023

More of our articles

13 Best Ways for Seniors to Stay Active in Columbus

13 Best Ways for Seniors to Stay Active in Indianapolis

14 Best Ways for Seniors to Stay Active in Seattle

15 Best Ways for Seniors to Stay Active in Denver

20 Questions to Ask Your Medicare Agent

2023 Medicare Annual Election Period (AEP)

Can Medicare Advantage Plans be Used Out of State?

Can Medicare Advantage Plans Deny Coverage for Pre-Existing Conditions?

Do I Need Medicare If My Spouse Has Insurance?

Do You Need Books on Medicare?

Do You Need Medigap if You're Eligible for Both Medicare and Medicaid?

Does Medicare Cover Abortion Services?

Does Medicare Cover Boniva?

Does Medicare Cover Cala Trio?

Does Medicare Cover Cartiva Implants?

Does Medicare Cover COVID Tests?

Does Medicare Cover Disposable Underwear?

Does Medicare Cover Driving Evaluations?

Does Medicare Cover Exercise Physiology?

Does Medicare Cover Flu Shots?

Does Medicare Cover Hearing Aids?

Does Medicare Cover Hypnotherapy?

Does Medicare Cover INR Machines?

Does Medicare Cover Iovera Treatment?

Does Medicare Cover Ketamine Infusion for Depression?

Does Medicare Cover Lipoma Removal?

Does Medicare Cover LVAD Surgery?

Does Medicare Cover Macular Degeneration?

Does Medicare Cover Nexavar?

Does Medicare Cover Ofev?

Does Medicare Cover Orthodontic Care?

Does Medicare Cover Oxybutynin?

Does Medicare Cover Ozempic?

Does Medicare Cover Penile Implant Surgery?

Does Medicare Cover PTNS?

Does Medicare Cover Scleral Lenses?

Does Medicare Cover Shock Wave Therapy for Plantar Fasciitis?

Does Medicare Cover SI Joint Fusion?

Does Medicare Cover the Urolift Procedure?

Does Medicare Cover the WATCHMAN Procedure?

Does Medicare Pay for Bunion Surgery?

Does Medicare Pay for Varicose Vein Treatment?

Does Medicare Require a Referral for Audiology Exams?

Explaining IRMAA on Medicare

Finding the Best Vision Plans for Seniors

Health Savings Accounts (HSAs) and Medicare

How Can I Get a Replacement Medicare Card?

How Do Medicare Agents Get Paid?

How Does Medicare Pay for Emergency Room Visits?

How Does the End of the COVID-19 Public Health Emergency Affect Your Medicare?

How Much Does a Medicare Coach Cost?

How Much Does Rexulti Cost with Medicare?

How to Apply for Medicare?

How to Choose a Medigap Plan

Is Balloon Sinuplasty Covered by Medicare?

Is Fair Square Medicare Legitimate?

Is the Shingles Vaccine Covered by Medicare?

Medicare Advantage Plans for Disabled People Under 65

Medicare Consulting Services

Medicare Savings Programs in Kansas

Medicare Supplement Plans for Low-Income Seniors

Plan G vs. Plan N

Seeing the Value in Fair Square

The Easiest Call You'll Ever Make

Top 10 Physical Therapy Clinics in San Diego

What is the 8-Minute Rule on Medicare?

What People Don't Realize About Medicare

What to Do When Your Doctor Doesn't Take Medicare

When to Choose Medicare Advantage over Medicare Supplement

Which Medigap Policies Provide Coverage for Long-Term Care?

Why Is Medicare So Confusing?

Why You Should Keep Your Medigap Plan

Your Medicare One-Stop-Shop

Your guide to Medicare Parts A & B, Medicare Advantage, and Medigap. 100% free.
Get the Fair Square Bulletin

Medicare savings tips, helpful guides, and more.


Medicare 101

Current Clients

Medicare Supplement Plans

Medicare Advantage Plans

Fair Square 2023

Terms of Use
Notice of Privacy Practices

Virgil Insurance Agency, LLC (DBA Fair Square Medicare) and www.fairsquaremedicare.com are privately owned and operated by Help Button Inc. Medicare supplement insurance plans are not connected with or endorsed by the U.S. government or the federal Medicare program. This is a solicitation of insurance. A licensed agent/producer may contact you. Medicare Supplement insurance is available to those age 65 and older enrolled in Medicare Parts A and B and, in some states, to those under age 65 eligible for Medicare due to disability or End-Stage Renal disease. Virgil Insurance Agency is a licensed and certified representative of Medicare Advantage HMO, HMO SNP, PPO, PPO SNP and PFFS organizations and stand-alone PDP prescription drug plans. Each of the organizations we represent has a Medicare contract. Enrollment in any plan depends on contract renewal. The plans we represent do not discriminate on the basis of race, color, national origin, age, disability, or sex. Plan availability varies by region and state. For a complete list of available plans please contact 1-800-MEDICARE (TTY users should call 1-877-486-2048), 24 hours a day/7 days a week or consult www.medicare.gov. © 2022 Help Button Inc

We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all of your options.