As people approach their 65th birthday (and Medicare eligibility), they often ask this question: “How does Medicare work with other insurance?” If you’ve asked the same question, today’s topic is for you. We look at how Medicare works with other insurance, plus give you a few real-life examples of how Medicare affects your additional insurance when you first enroll in Medicare. Let’s dive right in. 

How Medicare Works With Other Insurance

There are several different ways Medicare coordinates with other insurance. To explain this, let’s look at a few scenarios. 

Scenario #1: You Are Still Working

For this scenario, let’s assume you or your spouse are still working, meaning you're covered by an employer-provided plan. How does Medicare work if you’re still on an employer’s plan? First, the size of the group at work will determine how Medicare is going to coordinate your coverage. 

If you're in a small group plan (one to 19 employees insured in the group), Medicare will pay first and your group plan will pay second. On the other hand, if you're in a larger group plan (20+ employees insured on the plan), then your group plan will pay first, and Medicare will pay second. 

Now, many times it's in your best financial interests (as well as your coverage interests) to drop the group plan, place Medicare in the first payor position, and get other insurance. Other times it’s best to stay on your group plan. 

For example, if you have great coverage in your group plan or you have a younger spouse or children still on the group plan, then it’s probably best to stick with that plan. 

Scenario #2: You Are Retired

For this scenario, let’s say both you and your spouse are retired. This means neither of you has employer-provided insurance options available. Keep in mind, if you are retired, you are required to enroll in Medicare. Once you’ve enrolled, Medicare will always pay first, and any other insurance you have will always pay second. 

Now, this other insurance could be a COBRA plan, some kind of retiree insurance, or a Supplemental plan. No matter the plan, when you retire and enroll in Medicare, your additional insurance coverage will always pay second to Medicare (which is what you want!). 

This is why it’s so important for anyone who is retired to enroll in Medicare A and B. If you fail to enroll upon retiring, Medicare will not be in the first payor position, plus you could be subject to a whole host of Medicare fees and penalties when you finally end up enrolling. 


There are different rules for how Medicare works with other insurance based on whether you (or your spouse) are working or retired. If you’re still working and are on an employer-provided group plan, Medicare may be in either the first or second payor position based on the size of the group. 

If you’re retired and enrolled in Medicare A and B, Medicare will always be in the first payor position, no matter what additional insurance coverage you go with. 

We understand how difficult making the right Medicare decisions can be. To take the next step, watch our full course here or schedule a free one-on-one call with a certified Medicare School Guide who can answer your questions, compare plans options, and even help you enroll. Click here to get started.



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