Can you retire at 64 and get Medicare? What Early Retirees Need to Know

Unfortunately, simply retiring at age 64 does not automatically qualify you for Medicare, as the standard eligibility age is 65. Early retirees must understand the crucial coverage gap and plan for alternative health insurance options until their 65th birthday, unless they meet specific medical criteria.

Quick Summary

The standard eligibility age for Medicare is 65, so retiring at 64 requires a plan for health coverage during the interim year. Options include COBRA from a former employer, a health plan from the Affordable Care Act (ACA) marketplace, or coverage through a working spouse. You may qualify for early Medicare if you have a specific disability or condition.

Key Points

• Medicare Eligibility Age is 65: The standard age to qualify for Medicare is 65, not 64, requiring early retirees to plan for an interim coverage year.

• Exceptions for Earlier Eligibility: Individuals with certain disabilities, End-Stage Renal Disease (ESRD), or ALS can qualify for Medicare before age 65.

• Bridging the Gap: Options for health coverage at age 64 include COBRA, a plan from the Affordable Care Act (ACA) marketplace, or coverage through a spouse's employer.

• Avoid Late Enrollment Penalties: Enroll in Medicare during your seven-month Initial Enrollment Period (IEP) around your 65th birthday to avoid lifelong premium penalties.

• ACA Special Enrollment Period (SEP): Losing employer coverage by retiring triggers an SEP, allowing you to sign up for an ACA plan outside the normal enrollment window.

• Costs for Interim Coverage: Be prepared for higher health insurance costs for the year before Medicare, especially with COBRA, which often requires you to pay the full premium.

Medicare Eligibility at 64: The Rules

Medicare is the federal health insurance program primarily for people aged 65 and older. The rule is based on age, not retirement status. Therefore, if you retire at 64, you will have a one-year gap where you do not have access to Medicare coverage based on age alone. This means you must find a different form of health insurance to cover your medical needs until you turn 65 and your Initial Enrollment Period (IEP) begins.

Exceptions for Early Medicare Eligibility

While age 65 is the standard, there are a few exceptions that could make you eligible for Medicare before that age, even at 64.

• Social Security Disability Insurance (SSDI): You can qualify for Medicare if you have been receiving SSDI benefits for 24 months. The 24-month waiting period would mean you must have been approved for disability benefits before age 63 to become eligible at 64.
• End-Stage Renal Disease (ESRD): Individuals with permanent kidney failure who require regular dialysis or a kidney transplant are eligible for Medicare at any age. There is typically a three-month waiting period before coverage starts, but it can be waived.
• Amyotrophic Lateral Sclerosis (ALS): People diagnosed with ALS (Lou Gehrig's disease) are immediately eligible for Medicare when their SSDI benefits begin, without the 24-month waiting period.

Filling the Health Insurance Coverage Gap

If you are a healthy 64-year-old retiring early, you must actively seek out an alternative health insurance plan to bridge the one-year gap until you are eligible for Medicare. Ignoring this gap could expose you to significant out-of-pocket medical costs.

Here are some of your primary options:

• ACA Marketplace Plan: The Affordable Care Act (ACA) marketplace, found at HealthCare.gov, provides an exchange where you can purchase individual or family health insurance plans. Retiring and losing your employer-sponsored coverage is considered a qualifying life event, triggering a Special Enrollment Period (SEP) that allows you to enroll immediately.
• COBRA: The Consolidated Omnibus Budget Reconciliation Act (COBRA) allows you to continue your health coverage from your former employer for a limited time, typically 18 months. While it ensures continuity of coverage, you will be responsible for the full premium, which can be significantly more expensive than when you were an employee.
• Spouse's Plan: If your spouse is still working and has health insurance through their employer, you may be able to be added to their plan until you turn 65.
• Private Insurance: You can explore private, non-marketplace insurance plans. Be aware that these plans may have different coverage rules and pricing structures than ACA marketplace plans.

Understanding Medicare Enrollment Periods

It is crucial to understand the Medicare enrollment periods to avoid late enrollment penalties. If you retire at 64, your key enrollment window will be your Initial Enrollment Period (IEP) around your 65th birthday.

Your IEP is a seven-month period that includes:

• The three months before the month you turn 65.
• The month you turn 65.
• The three months after the month you turn 65.

Missing this window can result in lifelong premium penalties for Medicare Part B and potentially Part D.

Comparison Table: Bridging the Coverage Gap at 64

Feature	ACA Marketplace Plan	COBRA	Spouse's Employer Plan
Cost	Varies by plan, subsidies may be available based on income	Typically more expensive, paying the full premium plus an administrative fee	Dependent on the spouse's employer and plan options
Coverage	Wide range of plans and tiers (Bronze, Silver, Gold, Platinum) with standard benefits	Continuation of your former employer's group plan	As defined by the spouse's employer plan
Availability	Available to most individuals losing coverage through a Special Enrollment Period (SEP)	Available for a limited period, typically up to 18 months	Contingent on the spouse's employment and company policy
Flexibility	Significant choice of plans and tiers, coverage starts immediately after qualifying event	You are locked into your previous plan and benefits	Determined by the spouse's employer and plan options
Drawbacks	Potentially high premiums without subsidies	High cost; coverage is temporary	Limited if spouse's employer does not allow adding a retiree

The Path to Medicare from 64

Your transition to Medicare should be a well-researched and smooth process. Start by evaluating your current health and financial situation while still working at 64. As you enter the final months before your retirement, investigate your alternative health insurance options to bridge the gap. Begin your Medicare enrollment process within your Initial Enrollment Period, which starts three months before your 65th birthday, to ensure seamless coverage and avoid any late enrollment penalties.

Careful planning ensures you maintain continuous, comprehensive health coverage as you transition from employment-based insurance to Medicare. For personalized advice, consider contacting a State Health Insurance Assistance Program (SHIP) or a qualified insurance broker.

Conclusion

While retiring at 64 is a significant personal milestone, it's crucial to understand that Medicare eligibility does not begin until age 65 for most people. Early retirees must proactively arrange for health coverage during this one-year period. Options such as COBRA, ACA marketplace plans, or a spouse's plan can provide a temporary solution. By exploring these options well in advance and being mindful of Medicare's Initial Enrollment Period, individuals can ensure a smooth and financially secure transition to Medicare and a well-protected retirement.

Frequently Asked Questions

If I retire at 64, can I enroll in Medicare through my spouse's policy?

No, Medicare eligibility is based on an individual's age or disability, not a spouse's. If your spouse is already 65 or older and enrolled in Medicare, you cannot enroll early based on their eligibility. However, you may be able to join their employer's plan if they are still working.

What is the Initial Enrollment Period (IEP) for Medicare?

The IEP is a seven-month window during which you can first sign up for Medicare. It begins three months before the month you turn 65, includes your birthday month, and ends three months after.

Do I have to take COBRA if I retire at 64?

No, you do not have to take COBRA. While it is an option to continue your former employer's coverage for up to 18 months, you can also explore other options like an ACA marketplace plan or joining a working spouse's plan.

Will I automatically be enrolled in Medicare at 65?

Automatic enrollment in Medicare Parts A and B only occurs if you are already receiving Social Security retirement benefits when you turn 65. If you are not yet taking Social Security, you must sign up yourself during your IEP to avoid penalties.

Can I qualify for Medicare at 64 if I am disabled?

Yes, if you have received Social Security Disability Insurance (SSDI) benefits for 24 months, you will become eligible for Medicare. The 24-month waiting period means you would have to be approved for SSDI by age 63 to get Medicare at 64.

Is an ACA marketplace plan cheaper than COBRA for an early retiree?

The cost depends on your income. Without employer contributions, COBRA can be very expensive. ACA marketplace plans may offer subsidies that lower your monthly premiums, making them a more affordable option for many early retirees.

What happens if I don't get health insurance at 64?

If you go without health insurance at age 64, you will be responsible for 100% of your medical costs out-of-pocket until you become eligible for Medicare at 65. This can be financially risky in case of a serious health event.