Can I Work and Have Medicare Insurance?

Whether they’re concerned with affording retirement or love their job, Americans are working later in life. In fact, the percentage of older adults working today is the largest since the creation of the Medicare program in the 1960s.

Some individuals, maybe even you, will still be actively employed upon becoming eligible for Medicare insurance. Can you work full time and enroll in Medicare insurance, and if you choose to not enroll, will you get a penalty?

Can You Have Medicare Insurance While Working?

If you’re working when you enter your Initial Enrollment Period (IEP), you can enroll in Medicare insurance plans. As long as you meet all the criteria needed to be eligible, it is your right to do so. You can also choose to delay your Medicare insurance coverage, though you may be penalized later.

If you don’t receive health coverage through work, it’s safe to say you should get Medicare insurance coverage.

What If I Have Non-Retiree Health Coverage Through Work?

If you have non-retiree health insurance through your or your spouse’s employer when you become eligible, you’ll have to choose if you want to enroll in Medicare Parts A, B, and/or D. Ultimately, this decision depends on the type of health coverage you or your spouse currently have and the size of your or your spouse’s employer.

If the employer has fewer than 20 employees, you’ll probably want to enroll in Parts A, B, and D upon becoming eligible for them. In this situation, Medicare insurance usually becomes your primary coverage. If the employer has 20 employees or more, you may want to delay Parts A, B, and/or D if you have sufficient group coverage and know you won’t incur late enrollment penalties. Medicare insurance usually pays second to group coverage from larger employers.

Generally speaking, you should consider enrolling in Part A after qualifying for the Medicare program. For many seniors, Part A is premium-free and acts as great supplementary coverage. In some cases, it may not make sense to enroll in and pay the monthly premiums that come with Parts B and D right away. Before making the decision to delay any part of the Medicare program, compare the coverage to see if enrolling in it while covered by your current health plan makes sense. If you have any questions, you can always reach out to a licensed insurance agent or your employers’ Human Resources department.

When Can I Delay Medicare Insurance Enrollment Without a Penalty?

If you have non-retiree group coverage through your employer or your spouse’s employer, you will most likely be able to delay Medicare Parts A, B, and/or D without getting penalized. You could be at risk for receiving late enrollment penalties:

1. If the company you or your spouse works for has under 20 employees and you delay your Medicare insurance coverage
2. If you get qualifying coverage through your domestic partner’s workplace, but aren’t married to him or her, and delay your Medicare insurance coverage
3. If your employer does not offer creditable prescription drug coverage and/or you go at least 63 days without creditable drug coverage

What Happens with Medicare Insurance After I Retire?

Once your employment or non-retiree employee group coverage ends (whichever comes first), you’ll enter a Special Enrollment Period (SEP). During this SEP, which starts the month after the qualifying event and lasts for the eight months afterwards, you can usually enroll in a Medicare insurance plan without incurring a penalty.

If you don’t enroll in Parts A and/or B during the SEP, you’ll start to accrue a penalty that will take effect if and when you enroll in them.

With so many retirees counting on the Medicare program for coverage, we often don’t think about working while on Medicare insurance, but working and the Medicare program can go hand in hand. Whether you choose to have Medicare insurance while employed or rely on coverage through your work, you should look at your options to make sure it’s right for you. The same goes for remaining on your partner’s employee health plan after age 65. Knowing your options can keep you covered when you need it most and avoid a potential financial penalty.

Should you take Part A while you’re still working?

Many people can sign up for Part A while they keep working, even if they delay Part B. If you don’t have to pay a Part A premium, Medicare.gov says you can sign up at 65 or later.

Some people get Part A without asking. Social Security says that if you are 65 or older and already get Social Security benefits, you are enrolled in Part A automatically.

There is one big catch: a Health Savings Account (HSA). Social Security warns that contributing to an HSA after your Medicare coverage begins may lead to extra taxes. So if you or your employer put money into an HSA, think about the timing before you take Part A. The next section explains why.

What if you don’t qualify for Part A without a premium? Then you may have to buy it. In 2026, that costs $311 or $565 a month, depending on how long you or your spouse worked and paid Medicare taxes, per Medicare.gov.

If you must buy Part A and sign up late, the premium may go up 10% for twice the number of years you waited. A Special Enrollment Period based on current job coverage generally avoids that penalty, per Medicare.gov. This is one more place where working and Medicare timing matter.

If your employer has fewer than 20 employees, the situation is different. In that case, Medicare usually pays first. Ask your employer whether your job coverage will still pay if you don’t have both Part A and Part B.

How do HSAs and Medicare work together?

HSAs and Medicare don’t mix well, and the timing rule surprises many people. The key fact comes from Social Security: if you are over 65, Part A coverage begins up to 6 months before the month you apply. That is called retroactive coverage.

That back-dating can create a problem. If you contributed to your HSA during those months, those contributions may be taxed. Social Security warns that contributing to an HSA after your Medicare coverage begins may result in additional taxes.

To avoid this, Medicare.gov says you and your employer should stop HSA contributions about 6 months before you retire or apply for Social Security or Railroad Retirement benefits.

Hypothetical example: Dana is 67 and plans to retire and apply for Social Security in October. Dana’s Part A could be back-dated as far as April. If Dana keeps putting money into the HSA from April to September, those deposits may face extra tax. Stopping contributions by April avoids the overlap.

The rule is about adding new money to the account. For details on your own taxes, check IRS guidance or a tax professional.

What counts as job coverage for delaying Part B?

Not every health plan lets you delay Part B without a penalty. The coverage must be based on current work, either yours or your spouse’s.

According to Medicare.gov:

• Job coverage offered to everyone at the company: You can delay Part B without a penalty until you or your spouse stop working or lose that coverage.
• Self-employed, or coverage not offered to all employees: Check with your insurer whether it counts as employer group health plan coverage under IRS rules. If it doesn’t, sign up at 65 to avoid a Part B penalty.
• Retiree coverage: This is not coverage from current work. Retiree coverage may not pay for your care if you don’t have both Part A and Part B.
• No health coverage while working: Sign up for Part A and Part B at 65 to avoid a penalty.

Your spouse’s job counts too. Social Security says the Special Enrollment Period applies if you or your spouse have health insurance through your job. Ask your benefits office how your plan works with Medicare before you decide.

Good questions to bring to that conversation about working and Medicare:

• How many employees does the company have for Medicare purposes?
• Will the plan still pay first if I delay Part B?
• Is the plan’s drug coverage creditable, and can I get the yearly notice?
• When exactly will my coverage end if I retire on a given date?

What happens to Medicare if you leave your job and take COBRA?

COBRA lets you keep your former employer’s health plan for a while after you leave. It generally applies to employers with 20 or more employees. Coverage is generally offered for 18 months, or 36 months in some cases, per Medicare.gov.

The trap is timing. COBRA does not count as job coverage for Medicare enrollment. Medicare.gov is direct about it: COBRA coverage doesn’t extend your limited time to sign up for Medicare. Your 8-month Special Enrollment Period starts when you stop working, even if you choose COBRA.

Here is what else to know:

• If you have Medicare because you are 65 or older, Medicare pays first and COBRA pays second, per Medicare.gov’s “who pays first” rules.
• If you are eligible for Medicare but don’t sign up, COBRA may cover only a small part of your costs.
• If you have COBRA first and then sign up for Medicare, your COBRA will probably end.
• If you miss the 8-month window, you may have to wait for the General Enrollment Period (January 1 to March 31) and pay a lifetime Part B penalty.

For questions about COBRA and Medicare, Medicare.gov lists the Benefits Coordination & Recovery Center at 1-855-798-2627.

How do you sign up for Part B when job coverage ends?

When you or your spouse stop working, you have a Special Enrollment Period to sign up for Part B. Social Security says you can sign up:

• Any time while you are working and still covered by the group health plan
• Within 8 months of the day you or your spouse stop working, even if the group plan continues for a time
• Within 8 months of the group plan ending while you or your spouse keep working

Hypothetical example: Luis is 68 and retires on June 30. His job coverage ends the same day. His 8-month window starts when he stops working, so it runs into early the next year. If he also takes COBRA, the window does not change. Signing up in May or June, before his job coverage ends, helps him avoid a gap.

Coverage typically begins the month after you sign up. Social Security says it may start sooner or up to three months later in some cases. You can sign up for Part B online through Social Security, even if you already have Part A.

Two other clocks start around the same time:

• Drug coverage: To avoid a Part D penalty, don’t go 63 days or more without creditable drug coverage, per Medicare.gov.
• Medigap: Your one-time 6-month Medigap Open Enrollment Period starts when you sign up for Part B, per Medicare.gov. It lasts 6 months even if you still have employer coverage.

For the drug side, see our guide to the Medicare Part D penalty.

Does working past 65 raise your Medicare premiums?

It can. A paycheck often means higher income, and Medicare premiums rise with income. CMS calls the extra charge the income-related monthly adjustment amount, or IRMAA. It applies to both Part B and Part D.

Here are the 2026 amounts from the CMS 2026 fact sheet:

Hypothetical example: Pat and Lee file taxes jointly. Pat still works, and their joint income is $250,000. That falls in the second tier. In 2026, each of them would pay $284.10 a month for Part B, plus an extra $14.50 a month on top of any Part D plan premium. Medicare premiums are charged per person, so the extra amount applies to each spouse who has Medicare.

When you retire, your income may drop. If so, you can ask Social Security to lower your IRMAA. Social Security lists loss of income and an employer settlement payment among the life-changing events that qualify. You use form SSA-44, or call 1-800-772-1213.

What if you’re under 65, on Medicare due to disability, and working?

Different rules apply if you have Medicare because of a disability. For you, the employer size cutoff is 100 employees, not 20. Per Medicare.gov:

• If the employer has 100 or more employees, the large group health plan pays first and Medicare pays second.
• If the employer has fewer than 100 employees, Medicare pays first.

Returning to work can also affect your Part A. Some people with a disability who go back to work lose Part A without a premium and must pay for it. A Medicare Savings Program called QDWI can help pay that Part A premium. In 2026, its limits are $5,405 a month in income and $4,000 in resources for one person, per Medicare.gov. You apply through your state.

Working and Medicare: a checklist before you retire

Retiring is the moment when working and Medicare rules collide. This list pulls the key dates and steps into one place. It is general education, not advice for your exact case.

1. Six months out: If you have an HSA, plan to stop contributions to avoid the Part A look-back problem.
2. Three months out: Ask your benefits office for the exact date your job coverage ends, including drug coverage.
3. Check your drug coverage notice: Confirm your job’s drug coverage was creditable, and keep the notice.
4. Don’t count on COBRA: It does not extend your Medicare sign-up window.
5. Sign up for Part B: Use your 8-month Special Enrollment Period. Aim for coverage that starts when job coverage ends.
6. Arrange drug coverage: Avoid a gap of 63 days or more.
7. Note your Medigap window: It starts with Part B and lasts 6 months.
8. Review your income: If retirement lowers your income, ask Social Security about lowering IRMAA.

A licensed agent can help you compare options. You can also call 1-800-MEDICARE or visit Medicare.gov for information on all your choices. More guides are on our Medicare guides page.

Read more:
Medicare.gov. Working past 65. – https://www.medicare.gov/basics/get-started-with-medicare/medicarebasics/
working-past-65
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