What is the impact on a small employer group when a full-time employee turns age 65 and becomes eligible for Medicare?
Eligibility for Medicare does not preclude eligibility for coverage under the employer plan. Thus, the employee may be covered under both Medicare and the group plan. On the other hand, if the employee prefers to be covered only under Medicare, that decision will not have a negative impact on the group participation requirements. Carriers are required to count eligible employees covered under Medicare towards the participation requirement. If the employee elects to be covered under both Medicare and the group plan, there will be coordination of benefits between the plans. There are federal rules to determine which plan pays first and which plan pays second. The purpose of coordination of benefits is to allow a person to claim benefits from both Medicare and the employer plan, with the primary carrier paying benefits as if there were no other coverage, and the secondary carrier paying up to the difference between what the primary carrier paid and the amount of the allowable charge. When
