Toni Says

by Toni King

Medicare Rules Confuse HR Dept.


Hello Toni:

            I am a HR Manager for a local oil & gas company and have a question about an employee. He is turning 65 and still working full time. His situation is a little different because next month he will begin receiving chemotherapy for lung cancer. Not sure how to advise him because technically he is working full-time. He has 5 months of pay from unused vacation time, that he can use while recuperating, which keeps him as a full-time employee. 

            Our firm has over 100 employees and I have been told there are certain rules based on company size. How can I make sure that I have the correct answer to my questions for the employees of our company? Katie, Tampa, FL

Hi Katie:

Your employee with lung cancer is approaching his Medicare Initial Enrollment Period, which begins three months before his 65th birthday and ends three months after his 65th birthday month. Many Americans do not enroll in Medicare when turning 65 because they or their spouse are “still working” for an employer with over 20 employees and have employer group health insurance, such as your company. This rule can protect your employee still working full-time with health issues.

Now, readers, let us talk about who will pay your claim first. This depends on how many employees are on your company’s group health plan: (See chart on pg. 21 of the Medicare & You handbook on number of employees.)

  • If you are 65 or older and there are 20 or more employees where you or a working spouse currently receives benefits. (It may be to your advantage to delay enrolling in Medicare without receiving a Part B penalty.) The group health insurance pays first. (Please verify there are 20+employees enrolled in the employer group health plan).

  • If there are fewer than 20 employees where you or a spouse currently work and receives benefits, generally Medicare is primary. The HR Department should verify with the insurance carrier as to how the current health insurance plan coordinates with Medicare and whether an employee should enroll in Medicare Parts A and/or B or should delay enrollment in one or both.

Katie, below are a few options that can make your HR Department’s job easier:

  • Verify your employees’ options by calling your company’s health insurance plan to discover how the plan coordinates with Medicare.

  • It may be to an employee’s advantage to delay Part B enrollment. See the Medicare & You handbook under “Should I Get Part B?” for more clarification or in Chapter 1 of my book Medicare Survival Guide Advanced edition.


Employees should contact their local Social Security office immediately to enroll in Medicare when past 65 if their work status changes from full-time to part-time, laid-off, or retired to file the Social Security forms to avoid the “famous” Medicare Part B penalty. They will want an SEP (special enrollment period) and need to enroll in retiree benefits such as a Medicare Supplement or Medicare Advantage plan. It is important to remember that COBRA and retiree insurance are not considered current employer insurance, so do not delay in enrolling in Medicare Parts B and D (Medicare’s prescription drug plan). 

There are specific Medicare rules regarding leaving employer benefits after turning 65, when and how to change Medicare plans and which Medicare Part D prescription drug plans best fits one’s health situation which will be vital for an employee such as your employee with lung cancer issues.

With Medicare, it’s what you DON’T know that will HURT YOU! Need Medicare help? Call the Toni Says Medicare hotline at (832) 519-8664 or email for assistance. Toni’s books are available at with a bundle discount for Toni Says® readers.