When clients turn 65 and are still working, they often face a complex decision: should they enroll in Medicare or stick with their employer-sponsored coverage? As a Medicare agent, your role is to guide them through this important choice. It’s not just about comparing premiums—there are multiple layers to consider.
Here’s what you should keep in mind when supporting clients through this process.
1. Is Their Group Plan Considered Creditable Coverage?
Before clients make any decision, help them determine if their employer group coverage qualifies as “creditable” for Medicare Parts B and D. This classification will dictate whether they can delay Medicare enrollment without incurring penalties.
You will want to verify if:
- The employer has 20+ employees
- They or their spouse are “actively” working
- The coverage is considered creditable
- The drug coverage is as good as Part D coverage
They should receive an annual notice from their employer stating whether their coverage is creditable. Make sure they understand that being covered today doesn’t guarantee the plan remains creditable every year. Also, explain scenarios where Part B might be creditable but Part D is not, and help them weigh the impact of that.
2. Which Coverage Will Cost Less and/or cover more—Medicare or the Employer Plan?
Help clients do a detailed comparison of costs. Walk them through the following:
- Premiums: Consider Part B, any Medigap or Medicare Advantage premiums, and how that compares to their group premium.
- Deductibles and Coinsurance: Review out-of-pocket expenses before benefits kick in. Medicare does tend to have a lower deductible than many group plans, and many Medicare Advantage plans do not have a deductible. Copays and coinsurance is another expense. Consider the care and services they use most and see how copays differ between the group plan and Medicare.
- Out-of-Pocket Maximums: Also consider catastrophic circumstances. What is the maximum amount they could pay in the event of a catastrophic health event?
Use our fillable cost comparison worksheet or estimation tool to make this side-by-side review easy and visual.
3. Does the Group Plan Cover a Spouse?
If your client’s group plan covers a spouse who is not yet Medicare-eligible, their decision may impact family coverage. Discuss the consequences of leaving the group plan and explore alternate insurance options for the spouse if needed. The decision here will still come down to costs and coverage. Will it save or cost them more to find a marketplace plan for the spouse?
4. Do They Want to Keep Contributing to an HSA?
Clients actively contributing to a Health Savings Account need to understand that enrolling in any part of Medicare disqualifies them from continuing contributions. An HSA allows them to contribute pre-tax dollars that can be used to pay for qualified medical expenses. This also helps reduce their tax liability and gives them savings for medical expenses. If they need to continue contributions to their HSA, make sure they know they cannot do this if they join any part of Medicare. This includes Part A. Some people may choose to enroll in Part A even when they stay on their group plan. Even in this is the case, they can not contribute to their HSA.
5. Will Their Income Trigger an IRMAA Adjustment?
High-income clients may face a higher Part B and Part D premium due to IRMAA. Be proactive—review the current IRMAA brackets and estimate what their adjusted premiums might look like. This is important to make sure you are comparing accurate Medicare costs. A high income bracket could tip the scale when comparing Medicare against their employer plan.
Should Clients Enroll in Both Medicare and the Group Plan?
Some clients may consider enrolling in both, but more coverage isn’t always better. If they have creditable employer coverage, Medicare will act as secondary payer—useful for hospital stays if they enroll in Part A (which is usually premium-free), but not always worth it for Part B. Part B does have a premium. They would be paying for two premiums if they enroll in Part B while on their group plan. This means increased costs.
Also, enrolling in Part B while still working can start the six-month Medigap enrollment clock. Explain how early enrollment might impact their future ability to join a Medigap plan without underwriting after retirement.
Helping Clients Make the Best Decision
Deciding between Medicare and employer coverage is rarely straightforward. There are many moving parts—from costs to spouse coverage to HSA rules. Your expertise helps clients make confident, informed choices. Always compare all Medicare options available in their area, and walk them through how those stack up against their current plan.