Jul 25, 2025

Should You Keep Your Employer Health Plan or Switch to Medicare?

Turning 65? Compare Medicare vs. employer plans. Understand costs, coverage, and timing to make the best healthcare choice.

Should You Keep Your Employer Health Plan or Switch to Medicare?

As you become eligible for Medicare — either by turning 65 or through a qualifying disability — you’ll face an important decision: should you keep your employer health plan or enroll in Medicare? The answer depends on several factors, including your healthcare needs, budget, employer plan benefits, and available Medicare options.

While continuing with your employer plan may seem simple, there are important trade-offs worth exploring — especially when understanding how Medicare options interact with or replace employer coverage.

Understanding Your Medicare Options

Medicare includes multiple parts that work together to provide coverage. It’s important to understand the roles of Original Medicare (Parts A and B), Medicare Advantage (Part C), Part D (prescription drug coverage), and Medigap (Medicare Supplement Insurance). Each option offers different features and costs.

Some employers may offer Medicare Advantage plans to Medicare-eligible employees, while others coordinate with Original Medicare plus supplemental coverage.

Potential Benefits of Staying on an Employer Plan

If you’re working or retired and still have access to an employer-sponsored health plan, here are some potential benefits:

  • Continuity and Familiarity: Staying on a known plan may offer comfort if you're satisfied with your current doctors and benefits.
  • Medicare Coordination: In companies with 20 or more employees, the employer plan is usually primary, allowing you to delay certain Medicare parts without penalty.
  • Predictable Costs: Some employer plans have known premiums and out-of-pocket limits. Compare these against potential Medicare-related costs.

Considerations When Employer Plans Include Medicare Advantage

  • Limited Provider Networks: Employer-sponsored Medicare Advantage plans may restrict you to specific doctors or facilities.
  • Out-of-Pocket Costs: While premiums may be low, other costs like deductibles and co-pays could be higher than with Medigap.
  • Medigap Not Available with Advantage Plans: If enrolled in Medicare Advantage, you cannot purchase a Medigap policy to cover additional costs.
  • Plan Availability May Change: Employer-sponsored Medicare Advantage coverage is not guaranteed to continue in future years.

Original Medicare Plus Medigap: Another Option

Choosing Original Medicare with a Medigap plan may offer:

  • Provider Flexibility: Visit any doctor who accepts Medicare — no referrals required.
  • Additional Coverage: Medigap plans may help cover deductibles, co-pays, and coinsurance.
  • Nationwide Access: Unlike some employer or Advantage plans, Medigap often includes coverage across the U.S.
  • Fewer Restrictions: No network requirements or referrals are needed with Medigap.

Key Factors to Consider

  • Your current and expected healthcare needs
  • Doctor availability under each plan
  • How frequently you travel or may relocate
  • Total costs, including premiums and out-of-pocket expenses
  • The future stability of your employer’s coverage

Frequently Asked Questions

Can I have both employer insurance and Medicare?
Yes. If your employer has 20+ employees, the employer plan pays first, and Medicare pays second. If fewer than 20, Medicare may become primary.

Can I delay Medicare if I keep employer coverage?
Yes — as long as the coverage is creditable. You must enroll within 8 months of losing that coverage to avoid penalties.

Can I switch from employer insurance to Medicare later?
Yes. You have a Special Enrollment Period to sign up after losing employer coverage.

What if my spouse is still working?
If you’re on their employer plan, you may delay Medicare Part B without penalty, depending on employer size.

Get Licensed Guidance — At No Cost

This decision can impact your healthcare and finances for years to come. Licensed insurance agents at Silvur Insurance can:

  • Review your current employer coverage
  • Compare it to Medicare plans available in your area
  • Help you understand enrollment timing
  • Explore costs and coverage options

Ready to explore your options? Schedule a no-cost consultation with a licensed insurance agent. There’s no obligation to enroll.

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Our licensed, Michigan-based insurance professionals will help you find and enroll in the best Medicare plan for your unique needs.

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