Medicare Part D
Medicare and Employer Coverage: A Chicago Work Guide
CHICAGO — Turning 65 while you're still clocking in? You're not alone. Plenty of Chicagoans keep working past 65, and the big question usually sounds the same: "Do I have to sign up for Medicare now, or can I wait?"
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Key takeaways
- Your Initial Enrollment Period runs for 7 months: the 3 months before your 65th birthday month, your birthday month, and the 3 months after.
- If your employer has 20 or more employees, your group plan usually pays first, but if it has fewer than 20 employees, Medicare usually pays first and most people should enroll in Part A and Part B right away.
- COBRA and retiree coverage don't count as active employer coverage, so you still need to enroll in Part B within about 8 months of your job coverage ending to avoid a lifetime late-enrollment penalty.
- Medicare Advantage and Part D plan choices are set by county, so Cook County residents can check available options using the plan finder at Medicare.gov, which updates each fall before the Annual Enrollment Period (October 15 – December 7).
Chicago workers, here's how Medicare fits with your job
The short answer: it depends on the size of your employer and the kind of coverage you have. Getting this right matters, because signing up late — or dropping the wrong coverage — can lead to lifelong penalties or a gap in care.
Here's a plain-English walk-through.
First, know your Initial Enrollment Period
Your Initial Enrollment Period (IEP) is a 7-month window: the 3 months before your 65th birthday month, your birthday month, and the 3 months after.
Even if you plan to keep working, this window still opens. What you do during it depends on your job's health plan.
If your employer has 20 or more employees
If you work for a larger Chicago employer — think a downtown firm, a hospital system, a big retailer — your group health plan usually pays first, and Medicare would pay second if you enroll.
In that case, you generally can:
- Enroll in Part A (hospital) at 65. It's premium-free for most people who paid Medicare taxes long enough, so many workers take it. One caveat: if you contribute to a Health Savings Account (HSA), enrolling in any part of Medicare — including Part A — means you can no longer contribute. Check with your benefits team before you sign up.
- Delay Part B (doctor visits) without penalty, as long as your employer coverage is considered "creditable." When you eventually retire or lose the job coverage, you get a Special Enrollment Period (SEP) of 8 months to sign up for Part B without a late fee.
- Delay Part D (drugs) without penalty as long as your job's drug coverage is creditable. Your employer must send you a notice each year telling you whether it is.
If your employer has fewer than 20 employees
Smaller employers are common across Chicago's neighborhoods — from Pilsen storefronts to family firms in Jefferson Park. If your company has fewer than 20 workers, Medicare usually pays first, and your job's plan pays second.
That means most people in this situation should enroll in Part A and Part B when first eligible. If you don't, you could end up with big out-of-pocket bills because your employer plan may only cover what Medicare would have paid.
Ask your HR or benefits contact — in writing — how your plan coordinates with Medicare. This one question can prevent an expensive surprise.
COBRA and retiree coverage don't count the same way
This trips up a lot of people. COBRA and retiree health plans are not considered active employer coverage for Medicare purposes. If you're relying on either after leaving a job, you still need to enroll in Part B on time — usually within 8 months of your job-based coverage ending — or you may face a lifetime late-enrollment penalty.
By the numbers
Medicare Part B premium, 2006–2026
The standard monthly Part B premium has climbed from $88.50 in 2006 to $202.90 in 2026. Hover any point for that year’s premium.
Source: CMS. Standard premium shown; in some hold-harmless years many existing enrollees paid less. Confirm at Medicare.gov.
By the numbers
How people get Medicare in Cook County
(MA penetration in Cook County)
MA penetration from CMS enrollment data; Medigap share is an estimate. U.S. average is about 54% Medicare Advantage. These are area-level figures, not plan-specific.
What's changing in 2027
A few program-wide updates worth knowing as you plan:
- Part D out-of-pocket cap: Prescription drug costs under Part D are capped at $2,100 in 2026.
- Part D deductible: The maximum allowed deductible is $615 in 2026 ($700 in 2027).
- No more donut hole: As of 2025, the old coverage gap is gone. Part D now has three phases.
- Medicare Prescription Payment Plan: You can choose to spread your drug costs across the year in monthly payments instead of paying at the pharmacy counter.
- IRMAA: Higher-income enrollees pay extra for Parts B and D. In 2026, surcharges start above $109,000 in income for a single filer (higher for joint filers).
Chicago is in Cook County — here's what that means
Medicare Advantage and Part D plan availability is set at the county level, not the city level. Chicago is in Cook County, so the plans you can choose from are the ones offered to Cook County residents.
For the current list of plans and carriers available in your ZIP code, the plan finder at Medicare.gov is the official source. It updates each fall ahead of the Annual Enrollment Period (October 15 – December 7). If you're already on a Medicare Advantage plan, there's also the Medicare Advantage Open Enrollment Period from January 1 – March 31 each year.
Try it
How the 2026 Part D drug cap works
Slide to your estimated yearly prescription costs and see how the new $2,100 out-of-pocket cap protects you. This illustrates the standard Part D benefit; your plan may structure costs differently.
Once your out-of-pocket spending on covered drugs reaches $2,100, you pay nothing more for the rest of 2026. Confirm details at Medicare.gov.
Explore
When can you enroll? An interactive year
Enrollment windows are federal and the same nationwide. Confirm your personal dates at Medicare.gov or 1-800-MEDICARE.
Good to know
Frequently asked questions
Q: I'm 66 and still working at a large Chicago company. Do I need to sign up for anything?
Q: My spouse is on my employer plan. Does that change when they should enroll in Medicare?
Q: I got a letter about "creditable coverage." What is that?
- CMS — Medicare Part D program rules (medicare.gov)
For personalized answers, contact Medicare.gov, 1-800-MEDICARE, or your local SHIP.