Educational content only. Not Medicare, insurance, or financial advice. Not affiliated with CMS, Medicare.gov, or SSA.
By Keith Guirao, founder and editor of Savvy Senior Central (Maven Media).
If you or your spouse are still working when you turn 65, the federal question that decides almost everything is narrow: is your coverage group health plan coverage based on current employment as Medicare defines it?
If yes, you can often delay Part B without a late-enrollment penalty and use an 8-month Special Enrollment Period (SEP) when employment ends or that coverage ends, whichever happens first. If the coverage is COBRA, retiree insurance, Marketplace coverage, or a stipend arrangement that is not a group health plan, waiting can create a permanent Part B premium penalty and a coverage gap.
I have spent 18 years inside consumer marketing and lead generation in insurance and health. The same mistake shows up every season: people treat any “job-related” insurance as permission to skip Part B. Medicare.gov and CMS draw the line at current employment.
This page does not tell you to take Part B, and it does not tell you to wait. Confirm with the employer that provides the insurance (because job-based coverage might not pay if you skip Medicare), then enroll through Social Security when the rules say you should.
Premium-free Part A vs the Part B timing decision
Part A. Medicare.gov’s working-past-65 page: if you do not have to pay a premium for Part A, you can sign up at 65 or anytime later. Most people qualify for premium-free Part A through their own or a spouse’s work history (generally 40 quarters / about 10 years of Medicare-covered employment, as SSA determines). About 99% of beneficiaries pay no Part A premium, per CMS.
If you must buy Part A in 2026, CMS lists $311/month (30-39 quarters) or $565/month (fewer than 30). In most cases, buying Part A also requires Part B.
Many people take premium-free Part A at 65 even while delaying Part B. That can be sensible, but watch Health Savings Account (HSA) rules. Part A enrollment can affect HSA eligibility and can be backdated.
Part B. Nearly everyone pays a Part B premium. The 2026 standard is $202.90/month. Late enrollment generally adds 10% for each full 12-month period you could have had Part B but did not, usually for as long as you keep Part B. The working-past-65 exception exists to avoid that penalty when group coverage based on current work continues.
Higher-income people may also owe IRMAA on Part B (and Part D). Check SSA’s premium pages for brackets; do not invent them from a marketplace quote.
What “current employment” means and what it does not
CMS employer guidance and Medicare.gov align on the core test:
- You (or your spouse) are still working, and
- You have coverage under an employer or union group health plan based on that current employment.
While that is true, you may enroll in Part B anytime without the late penalty. After employment ends or the group coverage based on that employment ends (whichever is first), you get up to 8 months to sign up. Medicare.gov: the SEP starts when you stop working or lose the insurance, even if you choose COBRA or other coverage that is not Medicare.
Not current employment for this SEP:
- COBRA
- Retiree health from a former employer
- Marketplace coverage
- Many stipend / “allowance” arrangements that are not IRS-defined employer group health plan coverage
Ask whether the plan is employer group health plan coverage as the IRS defines it. If it is not, Medicare.gov’s direction is to sign up when you first become eligible.
Self-employed people, or people with coverage that is not available to everyone at the company (like some retiree plans), should ask the insurer the same question. If it is not group health plan coverage based on current work, delaying Part B can be expensive.
Employer size: who pays first (the 20-employee rule)
Even when you qualify to delay Part B, the employer’s headcount affects whether delaying is practical.
Medicare.gov who-pays-first rules for people 65 or older with group coverage based on current employment:
- Employer has 20 or more employees (or is in a multi-employer plan where at least one employer has 20 or more): the group plan usually pays first, Medicare pays second.
- Employer has fewer than 20 employees: Medicare usually pays first, the group plan pays second.
Small-employer plans may pay little or nothing if you do not have Part A and Part B. Medicare.gov’s sign-up tool says exactly that for under-20 employers: job-based coverage might not pay for health services if you do not have both parts. Ask the benefits administrator in writing before you skip Part B at a small firm.
*Medicare & You 2026* restates the 20-employee split, including the multi-employer exception. If you are in an employer HMO or PPO that pays first and you go outside that network, neither the plan nor Medicare may pay.
Disability-based Medicare (not ESRD) with group coverage based on a family member’s current work uses a 100-employee large-group threshold. ESRD has a separate ~30-month coordination period regardless of employer size. Those paths are outside this article’s main age-65 worker focus; see Medicare.gov for details.
How the 8-month SEP works in practice
Medicare.gov “when can I sign up” and “when does Medicare coverage start”:
- You can sign up anytime while covered by the group plan based on current work, or during the 8 months after employment or that coverage ends, whichever ends first.
- If you lose job-based health coverage before you or your spouse stop working, you still have 8 months to sign up.
- Coverage generally begins the month after Social Security (or the Railroad Retirement Board) gets your completed request.
- You need an extra form showing you had job-based coverage while you or your spouse were working (commonly referenced as employment-verification forms such as CMS-L564 / related SSA packets; confirm current form names on SSA.gov).
- If you want Medicare to start when job-based insurance ends, sign up for Part B about the month before you retire so SSA can process forms without a gap.
- If you sign up while still working, or within the first full month after employer coverage ends, you can ask to delay the Part B start date up to 3 months.
- This SEP does not apply if you are eligible based on ESRD, or if you are still inside your Initial Enrollment Period.
- Getting COBRA does not pause or restart the 8-month clock.
Miss the 8 months and you usually wait for the General Enrollment Period (January 1-March 31), with coverage starting the first of the month after you enroll under the live 2026 rule, and you may owe the Part B late penalty.
Forms and filing: use SSA online, phone, or local office. Railroad Retirement Board handles RRB annuitants.
COBRA traps (the most common expensive mistake)
Medicare.gov’s COBRA guidance for people who have not signed up for Medicare yet:
- Sign up for Medicare when you turn 65 to avoid gaps and a monthly Part B late enrollment penalty.
- COBRA will probably end once you sign up.
- Do not wait until COBRA ends to sign up for Part B. COBRA does not extend your limited time to sign up for Medicare.
If you already have Medicare and then take COBRA, COBRA generally pays after Medicare (with an ESRD exception noted on Medicare.gov).
Who-pays-first page, COBRA at 65 or older: Medicare pays first. If you have COBRA and you are eligible for Medicare, COBRA may only pay a small portion; you may have to pay most costs yourself. Contact the COBRA plan.
That is why this page will not say “keep COBRA and skip Part B.” Medicare.gov’s instruction is the opposite of that pitch.
Retiree coverage is not a delay ticket
Retiree coverage from a former employer is based on former employment, not current work. Medicare.gov: Medicare usually pays first; the group plan pays second. Retiree coverage might not pay medical costs during any period when you were eligible for Medicare but did not enroll. When you become eligible, you may need both Part A and Part B to get full retiree benefits.
Before you join a Medicare Advantage or drug plan the employer does not offer, ask whether you or family members will lose retiree coverage. Do not risk that coverage on a brochure assumption.
Marketplace, stipends, and “no insurance”
Marketplace. Once you are eligible for premium-free Part A, you generally no longer qualify for Marketplace premium help. Keeping that help after eligibility can mean repaying all or part of it at tax time. Update Marketplace coverage and compare carefully; Medicare.gov has a Marketplace-to-Medicare path.
Stipend / private insurance bought with a work allowance. Ask the insurer how it pays once you are Medicare-eligible. Some private companies pay less or nothing. Once you sign up, Medicare typically pays first.
No health insurance, still working. Sign up for Part A and Part B when first eligible (usually 65). Signing up later can mean a penalty and months without coverage.
Medicaid. Rules vary by state. Many state Medicaid programs pay Part B premiums. Check with your state Medicaid office whether it enrolls you or whether you must file with SSA.
Drugs, creditable coverage, and the Part D track
Prescription drug rules run parallel to Part B. Medicare.gov: as long as you have creditable drug coverage (coverage expected to pay at least as much as standard Part D), you can wait to join a Part D plan or an Advantage plan with drugs. Your plan must tell you whether coverage is creditable and usually sends that notice yearly. Keep it. Do not send it to Medicare.
You avoid the Part D late enrollment penalty if you do not go more than 63 days without creditable drug coverage. The 2026 national base beneficiary premium used for that math is $38.99. Extra Help also prevents the Part D penalty while you have Extra Help.
If you have employer or union coverage and get Medicare drug coverage, you may lose employer or union health and drug coverage for you and your dependents, and you may not get it back, even with Extra Help. Call the benefits administrator before you change anything.
FEHB plans generally include creditable drug coverage. Confirm with your specific plan.
Health Savings Accounts
Medicare.gov: if you have an HSA, you and your employer should stop contributing 6 months before you retire or apply for benefits from Social Security (or the Railroad Retirement Board), to avoid a tax penalty. Enrolling in Medicare Part A can affect HSA eligibility even when Part B is delayed. Confirm timing with your benefits office and a tax advisor. This page does not invent contribution limits.
Initial Enrollment Period vs the 8-month SEP
Your Initial Enrollment Period is generally 7 months around age 65 (3 months before, birthday month, 3 months after). That is the first window for people who do not qualify to delay.
The 8-month employment SEP is different: it protects people who had group coverage based on current work and properly delayed Part B. Details on both calendars (plus AEP, OEP, GEP, and penalty examples), sit on our enrollment windows guide. Do not conflate the two clocks.
Checklist before you enroll or delay
- Ask HR whether coverage is based on current employment and how many employees the employer has for Medicare secondary-payer rules. Get it in writing.
- Ask whether you need Part A, Part B, or both for the plan to pay correctly at 65.
- Ask whether drug coverage is creditable; keep the written notice.
- If coverage will end, sign up for Part B about a month before the end date so Social Security can process forms without a gap.
- If you have an HSA, confirm when contributions must stop relative to Part A.
- After A and B start, choose Original Medicare (with or without Medigap and Part D) or Medicare Advantage. Check whether retiree coverage survives that choice.
- Confirm with Medicare.gov, SSA, and SHIP, not with a cold-call script.
Put simply
Working past 65 still means confirming whether your coverage is group health based on current employment. If yes, you may delay Part B without a late penalty and use an 8-month SEP when work or that coverage ends first. If the coverage is COBRA, retiree, Marketplace, or otherwise not current-employment group coverage, the SEP you think you have may not exist. Confirm with the employer, SSA, and Medicare.gov before you skip a premium that later becomes permanent.
This page does not rank carriers or treat a marketplace quote as a CMS or SSA figure.
FAQ
Can I delay Part B if I am still working?
Maybe. If you or your spouse have group health coverage based on current employment, Medicare.gov says you can wait to sign up for Part B without a late penalty, then use an 8-month SEP when the job or the coverage ends, whichever is first. Ask the employer. Small employers (under 20 employees) may require you to have A and B or the job-based plan will not pay.
Does COBRA give me extra time to sign up for Part B?
No. The 8-month SEP starts when you stop working (or lose the job-based insurance), even if you choose COBRA. Do not wait until COBRA ends. Medicare.gov: COBRA is not considered group health plan coverage for this SEP.
Is retiree coverage the same as current employment?
No. Retiree coverage is based on former employment. Medicare usually pays first. You may need both Part A and Part B for the retiree plan to pay. Check before you skip Part B or join an Advantage plan the employer does not offer.
Should I take Part A at 65 even if I delay Part B?
Medicare.gov notes that most people do not pay a Part A premium, so you may want Part A at 65 even if you or your spouse are still working. Watch HSA contributions and backdating. Confirm with the employer and SSA.
What is creditable drug coverage?
Coverage expected to pay at least as much as Medicare’s standard drug coverage. Your plan must tell you each year. Going 63 or more days without creditable coverage can trigger a Part D late penalty (1% of the $38.99 2026 national base beneficiary premium per uncovered month). Extra Help is a separate protection.
How does the 20-employee rule work?
At 65+ with group coverage based on current employment: 20+ employees → group plan usually pays first; under 20 → Medicare usually pays first. Multi-employer plans can count if any participating employer has 20+. Get the count from benefits, not from a guess.
When does Part B start if I use the 8-month SEP?
Generally the month after Social Security or the Railroad Retirement Board receives your completed forms and employment verification. Sign up about a month before job-based coverage ends if you want to avoid a gap.
What if I miss the 8-month window?
You typically wait for the General Enrollment Period (January 1-March 31), may go without Part B for months, and may owe a lifetime-style Part B late penalty (10% per full 12-month period you could have enrolled). Confirm current start-date rules on Medicare.gov.
Sources
Every figure traces to Medicare.gov, CMS, or SSA. We do not cite insurance marketplaces for data. Figures last verified September 22, 2026 (ET).
- Medicare.gov: Working past 65
- Medicare.gov: When can I sign up for Medicare?
- Medicare.gov: Who pays first
- Medicare.gov: Avoid late enrollment penalties
- CMS: 2026 Medicare Parts A & B Premiums and Deductibles
- SSA: ssa.gov
- Medicare.gov: Medicare & You 2026
- CMS: 2026 Part D Bid Information ($38.99 base)
