Millions of older Americans depend on Medicare to make healthcare affordable. Even so, Medicare brings its own costs that can stretch retirement budgets, from deductibles to monthly premiums. Most seniors look forward to enrolling when they turn 65, but that milestone raises an important question: should you claim Social Security at the same time?
You are eligible for both at 65, yet claiming them together is not always the smartest move. Understanding how these programs work independently can save you thousands in lifetime benefits, and knowing a few key rules before you file can prevent some costly surprises.
How Social Security Works and Why Waiting Pays Off
Social Security calculates your monthly retirement benefit using your earnings history, but your filing age plays an equally critical role in determining what you receive each month. The SSA bases your benefit on your highest 35 years of indexed earnings, but that figure can shrink or grow significantly depending on when you choose to file.
Claiming before full retirement age (FRA) permanently reduces your benefit. For anyone born in 1960 or later, FRA is 67. File at 62 and your monthly payment drops by a full 30%, leaving you with just 70% of your primary insurance amount for life. That is a meaningful haircut given that the average retired worker collects $2,071 per month after the 2026 cost-of-living adjustment.
Filing for Social Security while enrolling in Medicare at 65 could lock in that reduction permanently. On the flip side, delaying past your FRA increases your benefit by 8% for each year you wait, up to age 70. That is a 24% total increase if you hold out the full three years beyond FRA, and it compounds on top of any future COLA adjustments.
2026 Medicare Costs and IRMAA Thresholds
Medicare expenses climbed again for 2026, and beneficiaries need to budget accordingly. The standard Part B premium now stands at $202.90 per month, an increase of $17.90 from 2025, while the annual deductible rose to $283. For hospital stays, expect a $1,736 deductible per benefit period under Part A.
Higher earners face an additional cost layer through the Income-Related Monthly Adjustment Amount (IRMAA). These surcharges apply to individuals with modified adjusted gross income above $109,000 or joint filers above $218,000. At the top income brackets, total monthly Part B premiums can reach $689.90.
For beneficiaries already collecting Social Security, the premium math is especially pointed this year. The $17.90 per month Part B increase eats up roughly a third of the average $56 monthly COLA gain, leaving many retirees with a net purchasing power increase that is smaller than the headline 2.8% figure suggests. For those still working and weighing when to file, that squeeze reinforces the case for delaying Social Security to maximize the baseline benefit before Medicare costs take their bite.
The HSA Trap and Earnings Test
If you are still employed at 65, pay close attention to how Medicare enrollment affects Health Savings Accounts. Once you enroll in any part of Medicare (including the premium-free Part A), you lose the ability to make further HSA contributions. To preserve those tax-advantaged savings, you must delay all Medicare enrollment, provided your employer coverage qualifies as creditable.
This rule trips up many people. Even signing up for Part A alone closes the door on new HSA contributions. If building that balance remains a priority, confirm your employer plan meets Medicare creditable coverage standards before making any enrollment moves.
Working while collecting benefits before FRA also subjects you to the retirement earnings test. For 2026, the limit for those under FRA all year is $24,480. Social Security withholds $1 in benefits for every $2 you earn above that threshold. A separate, more generous limit applies in the year you actually reach FRA: the threshold rises to $65,160, with only $1 withheld per $3 of excess earnings, and the test disappears entirely the month you hit FRA. While withheld dollars are eventually credited back through an adjusted benefit at FRA, the arrangement creates a real cash flow squeeze in the meantime.
There is also a legislative backdrop worth noting. A bipartisan bill called the Senior Citizens’ Freedom to Work Act, introduced in early 2026 by Sen. Rick Scott and Rep. Greg Murphy, would repeal the retirement earnings test entirely. The proposal has been referred to committee but has not yet advanced, so the current rules remain in effect for now.
How to Sign Up for Medicare Alone
What confuses many people about signing up for Medicare is that the process runs through the Social Security Administration’s website. You enroll via your “my Social Security” account, which is the same portal where COLA notices and other official correspondence now arrive digitally.
The system lets you enroll in Medicare without filing for Social Security at the same time. If you are still working at 65 with employer-sponsored coverage, you can elect Part A alone as secondary insurance at no cost. One thing to keep in mind: if you enroll in Medicare without claiming Social Security, you pay your Part B premiums directly through billing or automatic bank payments rather than having them deducted from a benefit check.
Once you do start Social Security, Part B premiums are automatically deducted from your monthly benefit. But if you do not yet need the Social Security income, holding off and managing Medicare separately is a straightforward and financially sound approach. The two decisions are linked but independent, and treating them that way gives you more control over one of the most consequential choices in retirement planning.
Editor’s note: This article was updated to reflect the average Social Security retirement benefit of $2,071 per month after the 2.8% 2026 COLA, to add the FRA-year earnings test threshold of $65,160, and to include context on the Senior Citizens’ Freedom to Work Act introduced in 2026 that would repeal the retirement earnings test.
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