Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTMichael WilliamsSat, July 18, 2026 at 12:48 AM GMT+2 5 min readQuick ReadAt firms under 20 employees, skipping Medicare at 65 silently flips the group plan to secondary, leaving large claims paid at pennies on the dollar.Delaying Part B enrollment adds a permanent 10% monthly surcharge per year missed, applied to the $203 base premium for life.Unenrolled small-firm workers can owe full billed hospital charges because even free Part A requires active enrollment to pay any claims.Are you ahead, or behind on retirement? SmartAsset's free tool can match you with a financial advisor in minutes to help you answer that today. Each advisor has been carefully vetted, and must act in your best interests. Don't waste another minute; learn more here.A machinist at a 12-person tool shop hit 65, kept working, kept the group health plan he had used for two decades, and skipped Medicare enrollment. He figured his employer coverage was doing what it had always done. Then an outpatient surgery came back with the insurer paying pennies on the bill and the balance sitting on his kitchen table. His age had changed, and the payer order had flipped underneath him.designer491 / iStock via Getty ImagesThis is the Medicare Secondary Payer trap, and it hits workers at small firms almost exclusively. A reader whose employer has 20 or more employees can stop here: the rules run the other way, and delaying Medicare is generally safe. The pivot is the size of the employer.The 20-Employee Rule That Flips the Payer OrderMedicare's coordination rules assign a primary payer and a secondary payer whenever a worker age 65 or older has both Medicare eligibility and a group health plan. At employers with fewer than 20 employees, Medicare is the primary payer and the group plan pays secondary. At employers with 20 or more employees, the group plan is primary and Medicare pays secondary, which is why workers at larger firms can safely delay Part B until they retire and use the 8-month Special Enrollment Period without penalty._________________________________What's Your Number...?Here's a question most people 5y from retirement can't answer: at your current savings rate, how much do you need, and how long will it actually last? A good advisor can put a date on that in a single meeting. SmartAsset's free quiz matches you with up to three fiduciary advisors serving your area, so you can get YOUR retirement number now (sponsor)__________________________________________This distinction carries real financial weight. A secondary payer pays only what remains after the primary payer has paid its share. If a worker at a small firm never enrolls in Part A and Part B, Medicare pays nothing because there is no Medicare coverage in force. The group plan, sitting in secondary, then pays only the sliver it would owe after a hypothetical Medicare primary payment. In practice, that can leave routine claims paid at a fraction of billed charges, and larger claims effectively rejected.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info