If you’re turning 65 and still covered by your employer’s health insurance, you’ve probably heard conflicting answers about whether you must sign up for Medicare Part B.

Some say “Yes, absolutely.” Others say, “Not if your employer offers coverage.”

And then someone else says, “It depends on how many employees your company has.”

No wonder people are confused.

Let’s break it down — simply.

The Core Question

If someone is 65 or older and covered under an employer plan with fewer than 20 employees, do they have to sign up for Medicare Part B?

Short answer: Usually yes — unless that employer plan is structured to remain primary to Medicare.

Here’s why.

The Rule: Who Pays First Matters

Medicare has what’s called “coordination of benefits” rules.

When you’re covered by both Medicare and employer insurance, someone has to pay first (the primary payer) and someone pays second (the secondary payer).

• If your employer has 20 or more employees, the employer plan is usually primary, and Medicare is secondary.
  → You can delay Part B without penalty as long as that coverage is active and creditable.

• If your employer has fewer than 20 employees, Medicare is usually primary and the employer plan is secondary.
  → That means if you don’t have Medicare Part B, your employer’s plan may only pay a small portion — or possibly nothing — toward your medical bills.

That’s why people in small groups often need to enroll in Medicare Part B at 65 to avoid gaps in coverage or costly surprises.

Why This Gets Complicated

Some small employers join a PEO (Professional Employer Organization) or association health plan, which can group multiple small businesses together for insurance purposes.

If that’s the case, the coverage may be treated like a large group plan even if the company itself has fewer than 20 employees.

That’s where the confusion starts — because in those cases, the rules that apply to large employers might apply to you.

Easiest way to put it:

“The rules are clear, but the employer situation may not be.”

What About the L564 Form?

When you eventually apply for Medicare Part B after delaying, the L564 form confirms you had group coverage.

It doesn’t ask how many employees the company had — it just asks if your coverage was creditable (meaning it met Medicare’s standards).

But Medicare can still review how the plan was structured. If it was a small group plan where Medicare should have been primary, you could face a late enrollment penalty for delaying Part B.

Here’s the Bottom Line

✅ If your employer has fewer than 20 employees, you typically need to enroll in Medicare Parts A and B when you turn 65.

Your employer’s plan will then act as secondary coverage.

✅ If your employer is part of a PEO, association, or multi-employer plan, the rules might be different. You’ll need to verify how your plan coordinates with Medicare.

✅ If your coverage is creditable, you won’t face a penalty for delaying Part B — but creditable doesn’t automatically mean it’s primary.

Real-Life Example

We’ve seen cases where small group plans (like some Cigna or Aetna contracts) specifically state in their policy documents:

“This plan will pay as the secondary plan to Medicare Part A and Part B regardless of whether the person is actually enrolled in Medicare.”

That means even if you haven’t signed up for Medicare, your employer plan might act as if you did — leaving you on the hook for what Medicare would have paid.

The Safe Path Forward

Before making any decisions:

1. Ask your HR department or plan administrator if your coverage is creditable and whether it is primary or secondary to Medicare.

2. Request the plan’s coordination of benefits policy in writing.

3. Compare total costs — sometimes it’s actually cheaper to have Medicare A & B plus a supplement or Advantage plan than to stay on your small employer plan.

4. Work with a licensed broker (like our team at Mere) to review all your options side by side.

At Mere, We Simplify Medicare Decisions

We help individuals, families, and small business owners understand how Medicare coordinates with their existing coverage — so you don’t get caught off guard by unexpected bills or penalties.

If you’re approaching 65 and have employer coverage, especially through a small group, let’s talk before you make a decision.

📞 Call 904-654-5450 or visit www.merebenefits.com for guidance tailored to your situation.

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