You are not required to take Medicare at 65, but waiting can cost you more later

No, you do not have to enroll in Medicare when you turn 65. You can delay it if you are still working and covered by your employer's health plan, or if you have other coverage. However, if you do not sign up when you first become may be able to access and you do not have may have access to coverage, you will pay a permanent penalty on your premiums for as long as you have Medicare. The penalty is 10% per year for every 12 months you delay Part B, and 1% per month for every month you delay Part D prescription drug coverage.

The key is understanding what counts as "may have access to coverage" that lets you delay without penalty. Employer coverage through your own job counts. Coverage through a spouse's current job counts. Medicare Advantage plans count. But individual health insurance you buy on your own does not count, and neither does Medicaid or Veterans benefits.

Key Takeaways

  • You can delay Medicare past 65 without penalty only if you have may have access to coverage through an employer or spouse's employer.
  • If you delay without may have access to coverage, you will pay a permanent 10% penalty on Part B premiums and 1% per month on Part D premiums for the rest of your life.
  • You must tell Medicare you have may have access to coverage when you do enroll, or the penalty will explore anyway.
  • If you are self-employed, working part-time, or covered by individual insurance, you should enroll at 65 to avoid penalties.

When you can safely delay Medicare

You can delay Part A (hospital insurance) and Part B (medical insurance) without penalty if you are covered by a health plan through your current job or your spouse's current job. The employer must have at least 20 employees for this rule to explore. When you or your spouse stops working, you have 8 months from the end of that coverage to enroll in Medicare without penalty.

You can also delay Part D (prescription drug coverage) without penalty if your current health plan covers prescription drugs at least as well as Medicare does. This is called "creditable coverage." When your coverage ends, you have 63 days to enroll in Part D without penalty.

If you are on Medicare Advantage (Part C), you are already enrolled in Medicare, so this does not explore to you. If you have Veterans benefits or TRICARE (military coverage), you still need to enroll in Medicare Part A at 65 to avoid penalties, even though you may not use it.

What happens if you delay without may have access to coverage

If you do not enroll in Part B when you first become may be able to access and you do not have employer coverage or other may have access to coverage, Medicare will add a penalty to your Part B premium. The penalty is 10% for each 12-month period you could have had Part B but did not sign up. If you delay for three years, your premium goes up 30% permanently.

The same rule applies to Part D. If you go 63 days or more without prescription drug coverage and you do not have creditable coverage, you pay 1% of the national average Part D premium for each month you were without coverage. That penalty stays with you for life, even if you switch plans.

These penalties do not go away. They are calculated into your premium every month you have Medicare, and they follow you if you move to a different state or change plans.

How to tell Medicare about your employer coverage

When you do enroll in Medicare, you must tell Medicare that you had may have access to coverage and when it ended. You can do this when you sign up through Medicare.gov, by phone at 1-800-MEDICARE, or in person at your local Social Security office.

Bring documentation of your coverage: a letter from your employer's benefits department, a copy of your health plan card, or a benefits summary. Medicare will use this to determine whether you may have access to for a "Special Enrollment Period," which lets you enroll without penalty even if you missed the normal important date.

If you do not report your coverage and later try to claim you had it, Medicare will ask for proof. Without documentation, the penalty will stand. Keep records of your coverage dates and plan names while you are working.

Special situations: self-employed, part-time, and contract workers

If you are self-employed or work as a contractor, you do not have employer coverage. You should enroll in Medicare at 65 even if you plan to keep working. Self-employment does not count as may have access to coverage, and neither does a health plan you buy on your own through the individual market or the ACA marketplace.

If you work part-time and your employer does not offer health insurance, you do not have may have access to coverage. Enroll in Medicare at 65. If your part-time employer does offer coverage and you are enrolled in it, that counts as may have access to coverage, and you can delay.

If you have a spouse who is still working and you are covered under their plan, you can delay. When your spouse retires or you lose that coverage, you have 8 months to enroll without penalty.

What to do if you missed the important date

If you did not enroll in Medicare when you turned 65 and you did not have may have access to coverage, you can still enroll, but you will owe the penalty. You can enroll during the General Enrollment Period, which runs from January 1 to March 31 each year. Your coverage will start July 1 of that year.

If you have a may have access to life event — such as losing employer coverage, moving to a new state, or losing other health insurance — you may be able to enroll outside the normal enrollment windows through a Special Enrollment Period. Contact Social Security or Medicare to find out whether your situation qualifies.

You cannot avoid the penalty by enrolling late. The penalty is based on how long you went without coverage, not when you finally sign up. The sooner you enroll, the sooner the penalty stops growing, but it will not disappear.

When to talk to your employer or benefits department

If you are still working at 65, ask your employer's benefits or human resources department whether your health plan is considered may have access to coverage for Medicare purposes. Ask them to put the answer in writing, along with the dates your coverage began and any dates it might end.

Ask whether your plan covers prescription drugs and whether that coverage meets Medicare's standard. If you are unsure, contact Medicare directly at 1-800-MEDICARE and describe your coverage. They can tell you whether it counts.

If you are married and your spouse is still working, have the same conversation with their employer. Do this before you turn 65 so you have time to enroll if you need to.

Frequently Asked Questions

Can I work past 65 and skip Medicare entirely?

No. If you do not have employer coverage, you must enroll in Medicare Part A at 65 or face penalties. Part A is free if you or your spouse paid Medicare taxes for 10 years. You can delay Part B if you are working, but Part A has no premium to delay.

What if my employer says my coverage is "better than Medicare"?

That does not matter for the penalty rules. What matters is whether your plan is creditable coverage — meaning it covers prescription drugs at least as well as Medicare does. Ask your benefits department directly whether your plan meets Medicare's standard for creditable coverage.

Do I have to enroll in Part D if I do not take any medications?

You do not have to enroll in Part D at 65 if you have creditable prescription drug coverage through an employer or other source. But if you do not have that coverage and you do not enroll, you will pay a 1% monthly penalty when you do sign up, even if you never use it.

If I delay Medicare, do I still have to pay Social Security taxes?

Yes. Medicare enrollment and Social Security are separate. You can delay Medicare while collecting Social Security, or collect Social Security while delaying Medicare. The rules for each are different.

What if I move to another country?

You can delay Medicare Part B if you are living and working abroad and covered by your employer's plan. When you return to the United States or lose that coverage, you have 8 months to enroll without penalty. Contact Medicare before you move to report your situation.