No — if you are still working and covered by your employer’s group health plan, you do not have to take Medicare at 65. You can delay it without any penalty, provided that employer has 20 or more employees. If the company has fewer than 20, the answer flips, and delaying can cost you badly.
That one distinction — 20 employees — decides more of this than anything else, and almost nobody knows about it before we talk. This is the single most common situation I handle, so here is the whole thing laid out: when delaying is safe, when it is expensive, and the one trap that catches more people than the rest combined.
The question that decides everything: how big is the employer?
Medicare decides who pays first based on the size of the employer providing your coverage.
20 or more employees: the employer plan pays first, Medicare pays second. Your coverage counts as creditable, so you can delay Part B with no penalty.
Fewer than 20 employees: Medicare pays first. If you have not enrolled, the employer plan may only pay its share after Medicare would have paid — leaving you responsible for the gap Medicare was supposed to cover.
If you work for a small business, this is not a technicality. I have seen people assume they were covered, skip Part B, and then discover a hospital bill treated as if Medicare had already paid its portion. Ask your HR department how many employees the company has before you decide anything else.
The COBRA trap
COBRA does not count as creditable coverage for delaying Part B. This is the most expensive misunderstanding in this subject, and it is easy to fall into, because COBRA feels like a continuation of the same insurance you had last week.
It is not, as far as Medicare is concerned. The protection came from active employment, not from the plan itself. The moment you leave the job, that protection ends, even though the coverage continues. Every month spent on COBRA instead of Part B is a month counting toward a late penalty you will pay for the rest of your life.
Losing COBRA does open a Special Enrollment Period, so people assume the two are interchangeable. They are not. If you are on COBRA and over 65, this is worth a conversation this week rather than next month.
What delaying actually costs when you get it wrong
The Part B late enrollment penalty is 10% of the standard premium for every full 12 months you could have enrolled and did not. It is permanent. With the 2026 standard Part B premium at $202.90 a month, a two-year delay without creditable coverage means paying about 20% more every month, for life — not for two years.
Delay for the right reason and you pay nothing extra. Delay for the wrong reason and it follows you.
Part A, and the HSA question nobody asks in time
Most people have premium-free Part A once they have 40 quarters of work behind them, so enrolling seems like an easy yes. There is one exception worth pausing on: if you contribute to a health savings account, enrolling in any part of Medicare ends your ability to keep contributing.
If you are still funding an HSA, the timing of Part A becomes a real decision with a dollar figure attached. It is worth working out before you sign anything, not after.
When the job ends: your eight months
When employment or the group coverage ends — whichever happens first — you get an eight-month Special Enrollment Period to take Part B without penalty. Two things trip people up here. The clock starts at the earlier of those two events, not the later one. And retirement paperwork often moves slower than the deadline does.
Keep every annual notice your employer sends about whether the drug coverage is creditable. That paperwork is your evidence that the delay was allowed, and it is the thing people wish they had kept.
Should you take Medicare anyway, even while working?
Sometimes, yes. If the employer plan carries a high deductible, adding Medicare as secondary coverage can lower what you actually pay across a year. If the employer plan is generous and low-cost, delaying usually wins. There is no rule of thumb that beats running your actual numbers — premiums, deductible, and what you expect to use.
That comparison takes about fifteen minutes with the plan documents in front of us, and it is the part worth getting right.
Questions people actually ask
Do you have to take Medicare at 65 if you are still working?
No. If you are still working and covered by your employer’s group health plan, you can delay Medicare without penalty — as long as that employer has 20 or more employees. You are not required to enroll at 65 simply because you turned 65.
Can you have Medicare and employer insurance at the same time?
Yes, and plenty of people do. The question that matters is which one pays first. If your employer has 20 or more employees, the group plan pays first and Medicare pays second. If the employer has fewer than 20, Medicare pays first — and if you have not enrolled, you can be left with the share Medicare would have covered.
Can I delay Medicare Part B if I am still working?
Yes, when your coverage comes from active employment at a company with 20 or more employees. That coverage counts as creditable, so the late enrollment penalty does not apply. When the job or the coverage ends, you get an eight-month Special Enrollment Period to pick up Part B.
Can I take COBRA instead of Medicare?
This is the most expensive mistake in this whole subject, so read it twice: COBRA is not creditable coverage for delaying Part B. Losing COBRA opens a Special Enrollment Period, but sitting on COBRA instead of enrolling in Part B racks up a late penalty the entire time. People arrive at this discovery months later, and by then the penalty is permanent.
Who pays first, COBRA or Medicare?
Medicare. Once you are eligible for Medicare, COBRA becomes the secondary payer. That is the practical reason COBRA alone is a poor substitute — you are paying for coverage that is only picking up what Medicare would have paid first, while a penalty accrues in the background.
What is the Part B late enrollment penalty?
Ten percent of the standard Part B premium for every full 12 months you could have had Part B and did not — and you pay it for life, not for a year. With the 2026 standard premium at $202.90 a month, two years of delay without creditable coverage means paying roughly 20% more every month for as long as you have Part B.
Do I need to sign up for Part A even though I am still working?
Usually you can, because most people have premium-free Part A after 40 quarters of work. There is one important exception: if you contribute to a health savings account, enrolling in any part of Medicare — including Part A — ends your ability to contribute. If you are still funding an HSA, that timing needs a deliberate decision, not a default.
Why would someone over 65 not be eligible for Medicare?
Eligibility itself is rarely the issue. What usually happened is that someone did not enroll when they should have and now faces a penalty or a wait for the next enrollment window. The rarer cases involve not having enough work quarters for premium-free Part A, or immigration status and residency requirements.
What is a creditable coverage notice and who gets one?
Employers are expected to tell people each year whether their drug coverage is at least as good as Medicare’s — that notice is your evidence that a delay was allowed. Keep them. When someone challenges whether your delay was justified, that paperwork is what settles it.
Can you sign up for Medicare at 65 and still work full time?
Yes. Working full time does not stop you enrolling, and sometimes it is the better move — if the employer plan carries a high deductible, Medicare as secondary coverage can lower what you actually pay. Whether it helps depends on the specific plan, which is exactly the comparison worth doing before you decide.
The short version
Twenty or more employees, coverage from active work: you can delay safely. Fewer than 20, or you are on COBRA: enroll, and do it now. Contributing to an HSA: get the timing decided before you enroll in anything. If you are not certain which of those describes you, that is exactly the call to make — schedule a time or call (270) 721-5069.