You must drop your marketplace plan when Medicare starts, but the timing matters
Once you become may be able to access for Medicare at 65, you cannot keep a marketplace plan from the Affordable Care Act (ACA) as your primary coverage. Medicare becomes your main insurance, and you will need to end your marketplace plan. However, you have a window of time to make this change without penalty, and the exact steps depend on when your Medicare coverage begins.
The key is to coordinate the end date of your marketplace plan with the start date of your Medicare coverage. If you enrolled in Medicare Part A and Part B when you first became may be able to access, your coverage typically starts on the first day of the month you turn 65 or the first day of the month after you turn 65, depending on your birthday. Your marketplace plan should end the day before Medicare begins.
If you miss this window and keep both plans running at the same time, you will pay premiums for both — and the marketplace plan becomes redundant. Medicare will be the primary payer, meaning it covers claims first, and the marketplace plan will rarely pay anything. You can cancel your marketplace plan at any time without penalty once Medicare is active, but it is cleaner to coordinate the dates from the start.
Key Takeaways
- You must end your marketplace plan once Medicare coverage begins; you cannot legally keep both as active primary coverage.
- Contact your marketplace plan directly to request cancellation effective the day before your Medicare start date to avoid paying duplicate premiums.
- If you delay enrolling in Medicare and keep your marketplace plan instead, you may face a permanent penalty on your Medicare Part B premium when you eventually enroll.
- Some people use a marketplace plan as a temporary bridge if they turn 65 before they are ready to enroll in Medicare, but this requires careful planning to avoid penalties.
- If you have dependents under 65 on your marketplace plan, they can stay enrolled after you leave; the plan does not automatically cancel for the whole family.
How to end your marketplace plan when Medicare starts
Contact your marketplace insurance company directly — do not wait for them to notice you have Medicare. Call the customer service number on your insurance card or log into your marketplace account and look for a cancellation or plan change option. Tell them you are enrolling in Medicare and want to end your plan effective the day before your Medicare coverage begins.
Have your Medicare card or your Social Security statement showing your Medicare effective date ready when you call. Some marketplace plans will ask you to confirm your Medicare start date in writing; if they do, send a brief email or letter stating your name, policy number, and the date you want coverage to end. Keep a copy for your records.
If you enrolled in your marketplace plan during open enrollment and now realize you are turning 65 soon, you can request a plan change or cancellation outside the normal enrollment window. This is called a may have access to life event, and turning 65 and becoming may be able to access for Medicare counts. You do not need to wait until the next open enrollment period.
What happens if you delay Medicare and keep your marketplace plan instead
Some people turn 65 but are not yet ready to enroll in Medicare — for example, they are still working and have employer coverage, or they want to delay Part B to avoid the premium. In these cases, you can keep your marketplace plan temporarily, but there are important rules.
If you have employer coverage through a current job, you can delay Medicare Part B without penalty as long as you are actively employed and covered by that employer plan. Your marketplace plan can continue during this time. However, once you leave that job or lose the employer coverage, you have a limited window (usually 63 days) to enroll in Medicare Part B without facing a permanent penalty on your premium.
If you do not have employer coverage and you delay Medicare to keep your marketplace plan instead, you will face a late enrollment penalty on your Medicare Part B premium for as long as you have Medicare. The penalty is 10 percent of the standard Part B premium for each full year you delayed enrollment. This penalty does not go away, so this strategy is rarely worth it unless you have a specific reason to delay.
Dependents under 65 on your marketplace plan
If you have a spouse or children under 65 on your marketplace plan, they do not have to leave when you do. You can cancel your portion of the plan and your dependents can stay enrolled. Contact your marketplace plan and ask them to remove you as the policyholder but keep the dependents on the plan.
Depending on your plan and your state, you may be able to transfer the policy to your spouse or another adult family member, or the plan may allow the dependents to continue under a modified version of the same plan. Ask your marketplace plan directly what options are available — the process varies.
If your dependents need to find new coverage after you leave, they can enroll in a marketplace plan during open enrollment or if they experience a may have access to life event (such as loss of coverage). They are not required to enroll in Medicare until they turn 65.
Coordinating Medicare enrollment with marketplace cancellation
The safest approach is to enroll in Medicare first, confirm your coverage start date, and then cancel your marketplace plan. Here is the order:
- Contact Social Security or Medicare at least three months before you turn 65 to enroll in Medicare Part A and Part B (or Part A only if you are delaying Part B).
- Receive your Medicare card in the mail, which will show your effective date.
- Call your marketplace plan and request cancellation effective the day before your Medicare coverage begins.
- Confirm the cancellation in writing if the plan requests it.
- Keep your Medicare card and cancellation confirmation for your records.
Do not cancel your marketplace plan before you have confirmed your Medicare start date. If there is a delay in your Medicare enrollment, you do not want to be without coverage. Once you have your Medicare card in hand with the effective date printed on it, you can safely cancel the marketplace plan.
Marketplace subsidies and Medicare
If you were receiving a premium tax credit (a subsidy) to help pay for your marketplace plan, that subsidy ends when your marketplace coverage ends. You do not receive subsidies for Medicare — Medicare has its own premium structure based on your income and enrollment choices.
When you cancel your marketplace plan, you should also report the change to the marketplace so they can update your subsidy record. This prevents you from being asked to repay subsidies you received for months when you were also covered by Medicare. The marketplace will ask about this during tax time if you do not report it, so it is worth doing proactively.
What to do if you already have both Medicare and a marketplace plan
If you are currently enrolled in both Medicare and a marketplace plan, you should cancel the marketplace plan as soon as possible. Call your marketplace plan and request when ready cancellation. Ask them to refund any premiums you paid for months when Medicare was already active.
Some marketplace plans will issue a refund for duplicate coverage; others will not. It depends on the plan and your state. Even if they do not refund past premiums, canceling now stops you from paying for coverage you do not need going forward.
If you are unsure whether you are enrolled in both, log into your marketplace account and check your active plans, then call Medicare at 1-800-MEDICARE to confirm your Medicare coverage status. Having both active is not illegal, but it is wasteful and confusing.
Frequently Asked Questions
Can I use my marketplace plan while I wait for Medicare to start?
Yes. If there is a gap between when you cancel your marketplace plan and when Medicare begins, you can request that your marketplace plan stay active through that gap. However, most people's Medicare coverage starts on the first of the month they turn 65, so the gap is usually just a few days. Coordinate the dates with your marketplace plan to minimize overlap and duplicate premiums.
What if my marketplace plan year does not match my Medicare start date?
Marketplace plans run on a calendar year (January through December), but Medicare coverage can start any month. You can cancel your marketplace plan outside the normal enrollment window because turning 65 and becoming may be able to access for Medicare is a may have access to life event. Call your plan and explain the situation; they will process the cancellation for you.
Do I lose coverage if I cancel my marketplace plan before Medicare starts?
Only if you cancel too early. Make sure your Medicare coverage is active before you end your marketplace plan. Check your Medicare card for the effective date, then cancel your marketplace plan to end the day before. If Medicare is delayed, keep your marketplace plan active until Medicare actually begins.
Will Medicare cover things my marketplace plan covered?
Medicare covers hospital care, doctor visits, and prescription drugs (if you enroll in Part D), but the coverage rules and costs are different from marketplace plans. You may want to enroll in a Medigap or Medicare Advantage plan to supplement Medicare coverage. These are separate from marketplace plans and are designed specifically for people on Medicare.
What if I am not a U.S. citizen but have a marketplace plan?
If you are a lawful permanent resident or have another immigration status that qualifies you for Medicare, the same rules explore — you must end your marketplace plan when Medicare begins. If your immigration status does not may have access to you for Medicare, you may be able to keep your marketplace plan. Contact Medicare and your marketplace plan to understand your specific situation.