No. Under the Medicare Secondary Payer rules, an employer with 20 or more employees cannot require, pressure, or financially incentivize a Medicare-eligible active employee to drop the group plan in favor of Medicare. Doing so can trigger a civil money penalty of $11,823 per violation in 2026.
Medicare Coverage
How Medicare works alongside employer coverage: enrollment timing at 65, who pays first, Part D creditable coverage, and HSA rules for employees who keep working.
What is Medicare Part D “creditable coverage,” and what must employers disclose?
Creditable coverage is employer drug coverage that’s at least as good as standard Medicare Part D. Employers that cover Medicare-eligible people must tell them whether their drug coverage is creditable before October 15 each year, and must disclose creditable/non-creditable status to CMS within 60 days of the plan year start.
Should I enroll in Medicare at 65 if I’m still working?
It depends on your employer’s size. If your employer has 20 or more employees and you have active group coverage, you can usually delay Medicare without penalty. If the employer has fewer than 20 employees, Medicare generally pays first, so you should enroll at 65 to avoid gaps and penalties.
How does Medicare coordinate with my employer plan: who pays first?
For active employees 65+, the employer plan pays first if the employer has 20 or more employees, with Medicare second. If the employer has fewer than 20 employees, Medicare pays first. Disability-based Medicare uses a 100-employee threshold, and ESRD has its own 30-month coordination period.
Can I keep contributing to my HSA after 65 if I’m on Medicare?
No. Once you enroll in any part of Medicare, including premium-free Part A, you can no longer contribute to an HSA, though you can still spend the existing balance. To keep contributing while working past 65, you must delay all of Medicare, which usually means not claiming Social Security.
What is the Medicare Part D late enrollment penalty?
The Part D late enrollment penalty is a permanent surcharge added to your Part D premium if you go 63 or more days without creditable drug coverage after your initial enrollment period. It’s roughly 1% of the national base premium for each month you went without, for as long as you have Part D.