The 20-employee rule
If your employer (or your spouse's employer if you're on their plan) has 20 or more employees, the employer plan is PRIMARY and Medicare is SECONDARY. You can safely defer Medicare and use the employer plan as your main coverage. No late penalty when you eventually enroll.
If your employer has FEWER than 20 employees, Medicare is PRIMARY and the employer plan is SECONDARY. In this case, you MUST enroll in Medicare at 65, even if you have employer coverage. The employer plan won't fully cover what Medicare would pay because Medicare is primary by law.
This is the single most important question to ask: is my employer of 20+ employees, or under 20? If under 20, defer is not an option.
Should you take Part A even if you defer Part B?
Most people take Part A at 65 even while working — because for most, Part A is premium-free (40+ quarters). Taking premium-free Part A doesn't conflict with employer coverage and gives you hospital backup if something happens.
BUT — and this is critical — if you contribute to an HSA, you CANNOT contribute while enrolled in any part of Medicare. Enrolling in Part A (or any other part) ends your HSA contribution eligibility starting the month you enroll.
Even worse: if you're already collecting Social Security and you delay Medicare, you'll be auto-enrolled in Part A retroactively up to 6 months when you do sign up. So you can't truly 'just enroll later' in Part A if SS is involved.
Practical rule: if you're maximizing HSA contributions in your last working years, you may want to defer Part A and not collect Social Security until you stop contributing to the HSA.
The COBRA trap
When active employment ends and you elect COBRA: COBRA is creditable for Part D (no Part D penalty), but COBRA is NOT creditable for Part B (you can still get Part B late penalty).
Your 8-month Part B Special Enrollment Period begins the day active employment ends — not when COBRA ends. So if you elect 18 months of COBRA, your SEP closes after 8 months and you're stuck waiting for the next GEP.
Practical move: if you're laid off or retire and elect COBRA, enroll in Part B IMMEDIATELY (or within the 8-month window). Don't let COBRA give you a false sense of being 'covered.'
Form CMS-L564 — your evidence of coverage
When you enroll in Part B during the working-past-65 SEP, you'll need Form CMS-L564 — the 'Request for Employment Information.' Your employer fills out the dates of coverage and attests to it. Required documentation for SEP enrollment.
Get this form from SSA or download from cms.gov. Fill out Section A. Have the employer fill out Section B. Submit with your Part B enrollment application.
If your employer is gone (acquired, bankrupt, no HR), you can still document creditable coverage with pay stubs, insurance cards, ID cards, anything that shows continuous coverage. The bar is documentation, not specifically the form.
The 8-month return SEP
When active employment ends (job loss, retirement, leaving the company), you have 8 months to enroll in Part B without penalty. The 8 months starts the day your group coverage ends OR active employment ends, whichever is FIRST.
Most people don't wait the full 8 months. They enroll the month before coverage ends to avoid gaps. The SEP is a buffer, not a target.
If you miss the 8 months: GEP only. Late penalty applies. Avoidable but real.
Self-employed past 65
If you're self-employed at 65 and have your own individual health insurance: that doesn't count as 'creditable coverage' for Part B in the way employer group coverage does. You should enroll in Part B at 65 unless you have a specific group plan (some self-employed people via SHOP exchanges or trade associations have group coverage, which may qualify).
Self-employed scenarios get individualized. If you're a sole prop with an individual ACA plan, defer is risky. If you're an S-corp owner with a small group plan, you may be OK depending on the group size.
When in doubt: enroll in Part B at 65 and use Original Medicare or MA as your primary. Drop the individual plan or use it as supplemental dental/vision.