Federal Rules Applying to Employees and Dependents Age 65 or Older

From Regence WA:

A. You must give the employee the appropriate creditable/non-creditable drug coverage letter regarding enrollment in Medicare Part D.

B. In groups with fewer than 20 employees, an actively employed individual who is enrolled on Medicare may continue in the group with the same benefits, but Medicare will pay as primary. However, the group coverage will not duplicate benefits provided by Medicare.

C. Groups with 20 or more employees (TEFRA-eligible) are required to offer active employees age 65 or over and dependents age 65 or over of active employees the same group health care benefits offered to other employees and dependents under age 65. If such employees and dependents qualify for Medicare on the basis of age, this group health care coverage will be primary to Medicare.

D. Determining if your group is subject to TEFRA regulations will be based on your answer on your most current GMA to the TEFRA status of your group. Your group is TEFRAeligible if you employed 20 or more full-time and/or part-time employees during each of 20 calendar weeks in the current or preceding calendar year (January-December).

Please contact your legal counsel if you have questions regarding your responsibilities.

From ChatGPT:

Employers who are not subject to TEFRA (Tax Equity and Fiscal Responsibility Act) or Medicare Secondary Payer (MSP) rules have more flexibility in determining whether they allow Medicare-eligible employees to remain on the group health plan. Here’s a breakdown:

Employers Not Subject to TEFRA/MSP:

If an employer is not subject to TEFRA (i.e., they have fewer than 20 employees), they are generally allowed to force Medicare-eligible employees off the group health plan. However, this is typically a matter of the employer’s policy rather than a federal requirement. The employer may choose to terminate group health coverage for Medicare-eligible employees once they become eligible for Medicare, although some employers may allow them to remain on the plan.

Does It Matter Whether the Employee Enrolls in Medicare?

The employer can still remove employees from the group plan regardless of whether they enroll in Medicare. This means even if the employee does not enroll in Medicare, the employer may choose to end group health coverage. However, it is worth noting that Medicare Part A is typically free for eligible individuals, and some employees may prefer to stay on the employer’s group plan for the additional benefits (e.g., prescription drug coverage), even if they enroll in Medicare.

TEFRA-Eligible Groups (20 or More Employees):

In contrast, employers with 20 or more employees (subject to TEFRA regulations) must allow Medicare-eligible employees to remain on the group health plan if they choose. For these employers, group health coverage is primary to Medicare for employees and their dependents who qualify for Medicare based on age.

Summary:

• Employers not subject to TEFRA/MSP (fewer than 20 employees) can remove Medicare-eligible employees from the group plan, regardless of whether the employee enrolls in Medicare.
• Employers with 20 or more employees must allow Medicare-eligible employees to stay on the group health plan if they choose to do so.

From Google:

No, employers are generally prohibited from forcing Medicare-eligible employees off their group health plan, even if they are not subject to the Medicare Secondary Payer (MSP) rules or the Tax Equity and Fiscal Responsibility Act (TEFRA).