Medicare & Group Health Insurance

Employers provide health insurance for 59.3 percent of workers. When the employee becomes eligible for Medicare, his employment's health coverage might change. Section 1862 of the Social Security Act protects most---but not all--- group health insurance plans when employees receive Medicare.

Working Medicare Beneficiary

• The Social Security Act requires employers to provide Medicare beneficiaries age 65 and over the same group health insurance options as other employees or employee dependents. The employee's group insurance is the primary payer. However, employers with fewer than 20 employees can alter the employee's group coverage, unless the employer belongs to a multi-employer plan that includes an employer with over 20 workers.

Changes Upon Retirement

• When the employee retires, the Social Security Act does not require employers to continue group health coverage. If an employee declined Medicare Part B at age 65 because it duplicated his group insurance, he can enroll under a special enrollment provision if her group coverage changes or ends upon retirement.

Medicare Before 65

• When the Medicare beneficiary--either the employee or her spouse--is under 65, Medicare is the secondary payer for group health plans covering at least 100 employees. Medicare is the primary insurer for employers with fewer than 100 employees unless the multi-employer plan exception applies. Different rules apply for Medicare beneficiaries who qualify due to end stage renal disease (ESRD).