# Avoid Medicare Penalties by Checking Employer Size

> Check employer size before delaying Medicare Part B to avoid lifetime penalties.
- Title: Avoid Medicare Penalties by Checking Employer Size · Kiplinger
- Summary: Check employer size before delaying Medicare Part B to avoid lifetime penalties. Working past 65 with employer health coverage must confirm if their company…
- Keywords: medicare, employer size, part b, penalty, retirement planning, health insurance, enrollment period, medicare trap, Avoid, Penalties, Checking, Employer
- Source: Kiplinger — https://kiplinger.com/retirement/medicare/medicare-enrollment-traps-for-working-retirees
- Published: 2026-10-10T14:00:00+00:00
- Read time: 1 min
- Topics: medicare, employer size, part b, penalty, retirement planning, health insurance, enrollment period, medicare trap
## Medicare Enrollment Trap
Working past 65 with employer health coverage often misses Medicare Part B enrollment deadlines.

> Most of the expensive mistakes I see in retirement planning as a CFP® are subtle. This one is not.
## The 20-Employee Rule
If your employer has 20+ employees, you can delay Medicare Part B without penalty under a special enrollment period.

> If you work for a larger employer, generally one with 20 or more employees, your group plan can remain your primary coverage
## Small Employer Risk
Small employers may consider Medicare your primary payer even while you're still on the company plan.

> But if you work for a smaller employer, Medicare might be considered your primary payer once you turn 65
## Permanent Penalty
Missing Part B enrollment adds 10% to your premium for each full 12-month period you could have had Part B.

> The Part B penalty adds 10% to your premium for each full 12-month period you could have had Part B but did not
## Lifetime Cost Impact
Delaying Part B for three years adds a 30% monthly premium surcharge indefinitely.

> Delay three years when you should have enrolled, and you're looking at a 30% premium surcharge, every month, indefinitely
## Enrollment Windows
Your initial enrollment period is seven months around your 65th birthday with special enrollment periods for active employer coverage.

> Your initial enrollment period is a seven-month stretch around your 65th birthday: the three months before, your birthday month, and the three months after
## Critical Action Step
Confirm employer size and coverage coordination with Medicare before turning 65.

> Well before you turn 65, find out if your employer has more or fewer than 20 employees and confirm in writing how your plan coordinates with Medicare
## HSA Interaction
Enrolling in Medicare Part A while still contributing to a health savings account ends new HSA contributions.

> If you contribute to a health savings account, enrolling in any part of Medicare, including Part A, ends your ability to make new HSA contributions
## The Trap
This Medicare trap punishes people who weren't careless but were uninformed about enrollment rules.

> What makes this trap so frustrating is that it punishes inaction by people who weren't being careless, they were just uninformed
## Avoidable Mistake
A single phone call to HR can prevent lifetime Medicare penalties for working retirees.

> It's one of the rare retirement mistakes that is completely avoidable with a single phone call
## What Happens Next
Retirees must confirm employer plan interactions with Medicare before their 65th birthday to avoid penalties.

> Spend an afternoon confirming exactly how your employer plan interacts with Medicare, and put the relevant enrollment windows on your calendar
## Key takeaway

Working past 65 with employer health coverage must confirm if their company has 20+ employees to delay Medicare Part B without penalty.