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Working past 65, retiree coverage and Medigap
By Vadim Marusin, licensed Medicare insurance agent in Washington (WAOIC #1365574). Insurer data checked against the state chart current as of October 8, 2026.
If you still have job-based coverage at 65, the order you do things in matters. Taking Part B too early can burn your one-time Medigap window; taking it too late can cost a lifelong penalty.
Step 1: is your employer coverage primary?
It depends on employer size and whether the coverage comes from current work:
| Your situation at 65 | Who pays first | What most people do with Part B |
|---|---|---|
| Covered through your or your spouse's current job, employer has 20 or more employees | The employer plan | Can delay Part B without penalty |
| Current job, employer has fewer than 20 employees | Medicare | Take Part B at 65; the employer plan may pay little without it |
| Retiree coverage from a former employer | Medicare | Take Part B; retiree plans usually require it |
| COBRA | Medicare | Take Part B; COBRA doesn't let you delay without penalty |
Always confirm with your employer's benefits office in writing. Rules for some plans differ.
Step 2: time Part B to protect your Medigap window
Your six-month Medigap open enrollment starts when you're 65 and enrolled in Part B. If your employer coverage is primary and you delay Part B, your window waits for you. When you retire:
- Sign up for Part B during the eight-month Special Enrollment Period after the job or coverage ends (sooner is better, so there's no gap).
- Apply for Medigap so it starts the same day as Part B. Your open enrollment begins then, and insurers must accept you.
- If you lose group coverage, you also get a 63-day guaranteed-issue right. See guaranteed issue.
Keep the employer's written proof of coverage (CMS form L564 for Part B); Social Security asks for it.
Should you leave employer coverage for Medicare + Medigap?
Compare, line by line:
- Premiums: your share of the employer plan vs. the Part B premium ($202.90 a month in 2026), plus a Medigap premium, plus a Part D premium.
- Out-of-pocket risk: your employer plan's deductible and out-of-pocket maximum vs. Plan G's $283 Part B deductible.
- Networks: Medigap works with any Medicare provider nationwide.
- Spouse and dependents: Medicare covers only you. If your employer plan covers a younger spouse, leaving it may leave them without coverage.
- HSA contributions: you can't contribute to an HSA once you're enrolled in any part of Medicare, including premium-free Part A.
For many people with high-deductible employer plans, Medicare plus Plan G costs less and covers more. For people whose employer pays most of a rich family plan, staying put often wins.
Retiree plans
Retiree coverage usually pays after Medicare and may already fill some gaps. Compare it with Medigap on total yearly cost. Before dropping a retiree plan, check whether you can ever get it back (often you can't) and whether it includes drug coverage your spouse relies on.
Common questions
I'm 66 and still working. Do I need Medigap now?
Not if your employer plan from current work at a company with 20 or more employees is primary. Buy Medigap when you retire and take Part B.
Does COBRA count as creditable coverage for Part B?
No. COBRA doesn't give you a Special Enrollment Period for Part B. If you're on COBRA at 65, enroll in Part B during your initial enrollment period.
Can I keep my Medigap policy if I go back to work?
Yes. Medigap is guaranteed renewable. Some people suspend Medigap while on a new employer plan; ask the insurer about suspension rules before cancelling anything.