Medicare and the Affordable Care Act are two separate programs with different rules, funding, and who they cover

Medicare is a federal insurance program for people 65 and older, regardless of income or health history. The Affordable Care Act (often called Obamacare) is a law that changed how health insurance works for people under 65. They are not the same program, they do not use the same enrollment periods, and they have different costs and coverage rules.

If you are turning 65, you will enroll in Medicare through Social Security or Medicare.gov, not through the Affordable Care Act marketplace. If you are under 65 and do not have insurance through an employer, you may look at plans on the Affordable Care Act marketplace — but Medicare will not be an option for you until you turn 65.

Key Takeaways

  • Medicare is for people 65 and older; the Affordable Care Act marketplace is for people under 65 without employer coverage.
  • Medicare enrollment happens through Social Security or Medicare.gov during your Initial Enrollment Period around your 65th birthday, not through the Affordable Care Act marketplace.
  • If you delay Medicare past 65, you may pay a permanent penalty on your premiums, even if you have Affordable Care Act coverage.
  • You cannot have both Medicare and Affordable Care Act marketplace coverage at the same time — once Medicare starts, your marketplace plan ends.

Who each program covers

Medicare covers people 65 and older, some younger people with disabilities, and people with end-stage renal disease. You do not have to prove income or health status. If you worked and paid Medicare taxes, or if your spouse did, you are covered.

The Affordable Care Act marketplace covers people under 65 who do not have insurance through an employer, a union, Medicare, Medicaid, or the military. You can enroll regardless of health history or pre-existing conditions. Your out-of-pocket costs depend on your income — the lower your income, the more help you receive.

How enrollment works for each

When you turn 65, you have a seven-month window called your Initial Enrollment Period to sign up for Medicare. It starts three months before your birth month and ends three months after. You enroll through Social Security (if you are already receiving benefits) or directly through Medicare.gov. Missing this window can mean paying a penalty for the rest of your life.

The Affordable Care Act marketplace has a different calendar. Open enrollment usually runs from November through January each year. If you have a life event — such as losing employer coverage, getting married, or moving — you may be able to enroll outside the regular window. You sign up through Healthcare.gov or your state's marketplace website.

If you are under 65 and currently using an Affordable Care Act plan, you will need to stop that coverage and switch to Medicare when you turn 65. Your marketplace plan will end automatically on the day Medicare begins.

What happens if you are under 65 and on Medicare

A small number of people under 65 may have access to for Medicare because they receive Social Security Disability Insurance (SSDI) or have end-stage renal disease. If this is your situation, you cannot also use the Affordable Care Act marketplace — you must use Medicare.

When you turn 65, your Medicare coverage continues without interruption. You do not need to do anything special; you straightforward move from the disability category to the age 65+ category on the same Medicare program.

Penalties for missing Medicare enrollment

If you do not sign up for Medicare Part B (medical insurance) when you are first may be able to access, you will pay a late enrollment penalty for as long as you have Medicare. The penalty is 10 percent of the standard Part B premium for each full year you were may be able to access but did not enroll. This penalty does not go away, even if you enroll later.

The only exception is if you had employer coverage or Affordable Care Act coverage that was considered "creditable" — meaning it was at least as good as Medicare Part B. If you had that coverage, you can enroll in Medicare without penalty during an eight-month window after that coverage ends. You will need to show proof of the coverage you had.

How costs differ between the two programs

Medicare has a standard monthly premium for Part B (medical insurance), which changes each year. In 2024, the standard premium was $164.90 per month, though some people pay more based on income. You also pay a deductible, copayments, and coinsurance when you use care. Most people also buy Part D (prescription drug coverage) or a Medigap supplemental plan to lower their out-of-pocket costs.

Affordable Care Act marketplace plans have premiums that vary widely based on the plan you choose and your age. Your actual cost depends on your income — if you earn less, you receive tax credits that lower your premium. You also pay a deductible and copayments. The plans are organized into four metal levels (Bronze, Silver, Gold, Platinum), each with different cost-sharing.

What to do if you are approaching 65 and currently on an Affordable Care Act plan

Start the Medicare enrollment process three months before your 65th birthday. You can create an account at Medicare.gov and review your options for Part A (hospital insurance) and Part B (medical insurance). You will also need to decide whether to add Part D (prescription drug coverage) or buy a Medigap plan to cover costs Medicare does not pay.

Once Medicare is active, notify your Affordable Care Act marketplace plan that you are no longer may be able to access. Your marketplace coverage will end on the last day of the month before Medicare begins. Do not let both run at the same time — you will be billed for both, and Medicare will be your primary insurance anyway.

If you are still working and have employer coverage, you may be able to delay Medicare Part B without penalty. Talk to your employer's benefits department and to Medicare to make sure you understand the rules for your situation.

Frequently Asked Questions

Can I use the Affordable Care Act marketplace if I am 65 or older?

No. Once you are may be able to access for Medicare, you must enroll in it. You cannot use the Affordable Care Act marketplace as your primary insurance. If you are 65 and do not yet have Medicare, contact Medicare.gov or Social Security right away to enroll.

What if I am under 65, disabled, and on Medicare — can I also use the Affordable Care Act marketplace?

No. If you may have access to for Medicare because of disability, you are not may be able to access for the Affordable Care Act marketplace. Medicare is your only option. You can add prescription drug coverage (Part D) or a Medigap plan to lower your costs.

Do I have to pay back the Affordable Care Act tax credits if I enroll in Medicare?

No. When you enroll in Medicare, your Affordable Care Act coverage ends and your tax credits stop. You do not owe back any credits you received while you were may be able to access for the marketplace. Just make sure to report the change to your marketplace when it happens.

What if I miss my Medicare enrollment window?

You can still enroll in Medicare after your Initial Enrollment Period ends, but you will pay a permanent late enrollment penalty on your Part B premium. The penalty is 10 percent of the standard premium for each year you were may be able to access but did not enroll. Enroll as soon as you realize you missed the window to limit the penalty.

Can I delay Medicare if I have Affordable Care Act coverage?

If your Affordable Care Act plan is considered creditable coverage (as good as Medicare), you may be able to delay Part B without penalty. However, you must still enroll in Part A (hospital insurance) at 65 to avoid penalties. Contact Medicare to confirm whether your specific plan qualifies before you decide to delay.