Working Aged Protections
Employees age 65+ who are actively employed are entitled to the same employer plan benefits as younger employees. Employers with 20 or more employees cannot: (1) offer Medicare-eligible active employees lesser benefits than younger employees; (2) require Medicare-eligible employees to enroll in Medicare as a condition of employment; (3) offer Medicare-eligible employees a secondary plan instead of the primary employer plan; or (4) offer financial incentives to Medicare-eligible employees to opt out of the employer plan.
Prohibited Practices
- Offering Medicare-eligible employees a Medicare supplement instead of the primary employer plan
- Requiring Medicare-eligible employees to enroll in Medicare Part B as a condition of employer plan coverage
- Offering Medicare-eligible employees a cash payment to opt out of the employer plan
- Providing lesser benefits to Medicare-eligible employees (higher deductibles, lower coverage limits)
- Excluding Medicare-eligible employees from the employer plan
Financial Incentives
Watch Out
Offering financial incentives to Medicare-eligible employees to opt out of the employer plan is a common MSP violation. An employer who offers a $500/month cash payment to employees who waive employer plan coverage and enroll in Medicare is violating MSP — even if the employee voluntarily accepts the payment. The prohibition applies regardless of the employee's choice.