Navigating your health insurance can feel like you’re learning a foreign language that changes every year. For many people who qualify for Medicare (age 65 and older), they’re beginning to wonder, “Can I have both employer insurance and Medicare?” The answer (thankfully) is yes, but that means there are more steps to maximizing your coverage.
When you have both Medicare and employer-based insurance, a system called "coordination of benefits" dictates which plan pays first and how they work together. Your employer’s size is a crucial factor, with your policies’ coordination being affected.
If you work for a company with 20 or more employees, your employer's plan is considered the "primary" payer. This means it will typically handle the bulk of your medical expenses first, with Medicare acting as "secondary" insurance and picking up any remaining costs after the employer plan reaches its limits.
Imagine a surgery with a total cost of $20,000. Your employer plan might have a $5,000 deductible, meaning you'd be responsible for that upfront cost. Once you meet the deductible, the plan might pay 80% of the remaining $15,000, leaving you with a copay. Medicare would then step in as secondary insurance, potentially covering that coinsurance depending on your specific Medicare plan (like a Medigap supplement) and its coverage details.
But if your employer is staffed with less than 20 employees, Medicare is the primary payer, handling any initial medical bills. Your employer’s plan then acts as secondary insurance, kicking in to cover leftover expenses after Medicare has reached its limits. Additionally, if your employer’s plan is not “credible,” then you must get on Medicare.
While keeping both employer insurance and Medicare is certainly an option, you should also consider Medicare Advantage plans. Private insurance companies offer these as alternatives to Original Medicare (Parts A & B). They often combine hospital and medical coverage into one plan, sometimes with additional benefits like vision or dental care.
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