As workers reach the age of 65, they become eligible for Medicare, the federal health insurance program primarily serving individuals aged 65 and older. However, the intersection of Medicare eligibility and employment raises questions about employer responsibilities towards senior workers regarding healthcare coverage. 

Generally, individuals become eligible for Medicare when they turn 65, regardless of their employment status. However, certain factors determine whether they must enroll in Medicare or can delay enrollment while remaining on their employer's healthcare plan. 

Workers May Delay Medicare Enrollment

Workers who are still actively employed and covered by an employer-sponsored health plan may choose to delay enrolling in Medicare and remain on their employer’s plan without facing penalties. This is particularly relevant for employees of larger companies (defined as having 20 or more workers) that provide group health insurance coverage.  

Please note:  This is not always the case for smaller companies with less than 20 employees. .  If you have questions, please contact our office.

Employers Must Fulfill Responsibilities

When senior workers are enrolled in the employer's group health insurance plan, the employer has legal responsibilities to ensure compliance with Medicare rules and regulations. This includes providing accurate information to employees about their Medicare enrollment options and coordinating benefits appropriately. Employers must also notify Medicare if their group health plan coverage changes or if a worker's employment status changes, triggering Medicare enrollment requirements.

Employers must ensure that their group health insurance plan complies with Medicare secondary payer rules. This means that the employer's plan must coordinate benefits with Medicare and may not discriminate against employees based on their Medicare eligibility status.

Employers Must Supply a Notice of Creditable Coverage

If the employer’s healthcare plan provides prescription drug benefits, it must be documented that the coverage is at least as good as Medicare's standard prescription drug coverage. Employers who offer prescription drug coverage to their employees, retirees, or their dependents that is deemed creditable must notify Medicare annually regarding the creditable status of their plan. This notification helps Medicare-eligible individuals make informed decisions about enrolling in Medicare Part D. 

Employers must provide this notification to Medicare within specific timeframes, such as before October 15th each year or whenever there are changes to the prescription drug coverage that affect its creditable status. Failure to provide timely and accurate notification may result in penalties for the employer.

By understanding these factors and ensuring compliance with Medicare regulations, employers can support their senior workers in accessing appropriate healthcare coverage while fulfilling their legal obligations. We can guide your company through this process. Call us at Bay Area Health Insurance, and we can review your coverage and help ensure that you comply with the law.