Did you know that in 2017 49% of senior citizens did not have personal retirement savings?[1] It’s unfortunately true! To live comfortably in retirement and enjoy your time, you will want to have a substantial amount of money put away to support yourself in the years to come. There are many costs to consider in retirement, including your Medicare insurance. Those who did not save enough before retirement may consider working part-time for extra cash. “Should I notify Medicare if I start a part-time job,” is a common question when a senior returns to work, so keep reading to learn more about working part-time while receiving Medicare benefits.

Working part-time with employer insurance

Employers are not required to offer their part-time employees health insurance, but many do! If you are actively working part-time and like the employer’s health plan benefits, you can certainly enroll in the insurance plan. In this case, you would need to notify Medicare about working part-time since now you have another form of health insurance.

If you decide to stay enrolled in Medicare, you will want to understand how it will coordinate with your employer’s insurance. Let’s say your employer has more than 20 employees. The employer insurance would pay as primary, and Medicare would become your secondary coverage. Medicare will help cover the costs of the services your employer plan did not cover.

If your employer has fewer than 20 employees, the insurance plan is not considered creditable coverage for Medicare. Therefore, you would need to stay enrolled in Medicare, as Medicare is primary insurance, and the employer plan would pay as secondary. If your employer has less than 20 employees and you disenroll from Medicare and stay on your small employer insurance, you would be charged a late enrollment penalty once you apply for Medicare again.

Working part-time without employer insurance

When you return to work part-time, and your employer does not offer health insurance, or you decline coverage, you would not need to notify Medicare. You would continue paying your monthly premiums and be responsible for all out-of-pocket costs for your healthcare services. Medicare does not cover all healthcare services at 100%, so many seniors purchase additional Medicare plans, such as Medigap or Medicare Advantage, for cost-sharing help.

Additional Medicare plans

Those who have a Medigap or Medicare Advantage plan and go back to work part-time will want to evaluate their options. If you decide to enroll in your employer plan, a Medigap or Medicare Advantage would not be necessary.

For example, if you have large employer insurance, Medicare, and a Medigap plan, the Medigap plan would be unnecessary since you already have primary and secondary coverage. Therefore, you would be paying for a plan you wouldn’t use.

You would experience a coordination of benefits issue regarding Medicare Advantage plans since you have employer coverage.

Suppose you decide to delay a Medigap or Medicare Advantage plan due to being covered by employer insurance. In that case, you will likely qualify for a 63-day Medigap Guaranteed Issue to apply for a Medigap plan once you lose active employer coverage. Additionally, you will have a 2-month Special Enrollment Period (SEP) to apply for a Medicare Advantage plan.

Wrapping up

Many seniors decide to go back to work in retirement. If you return to work part-time, you will want to know who to notify and how Medicare will coordinate with your other health insurance plans. You don’t have to go at this alone, though; get a Medicare broker on your side to guide you through the tedious Medicare steps!

[1] https://www.census.gov/library/stories/2022/01/women-more-likely-than-men-to-have-no-retirement-savings.html

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