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Medicare and Teachers prior to 1984?

edited August 2012 in General Payroll Topics
Hello all,
I process payroll for a High School in Massachusetts. I am fairly new at this and i have come a across an employee that had not any Medicare deductions taken out for quite some time.

Now I know that they don't pay into Social Security because they pay into their own retirement system but I hadn't heard anything about Medicare.

This employee seems to have the understanding that there were exceptions for teachers hired prior to 1984 regarding Medicare such as never having to pay into it. Would there be any reason for her NOT to pay into Medicare? Could it be she is confusing Medicare with Social Security? I can't seem to find anything about NOT withholding medicare.

Can some one help me out?




  • State and local government employees hired (or rehired) after March 31, 1986, are subject to mandatory Medicare coverage. Public employees covered for Social Security under a Section 218 Agreement are already covered for Medicare. Employees whose services are not covered for Social Security but who are required to pay the Medicare-only portion of FICA are referred to as Medicare Qualified Government Employees (MQGE).

    Employees who have been in continuous employment with the employer since March 3l, 1986, who are not covered under a Section 218 Agreement nor subject to the mandatory Social Security and Medicare provisions, remain exempt from both Social Security and Medicare taxes, provided they are members of a public retirement system.
  • I was employed by a school district for 31 years and just learned recently that they did Not take any Medicare out of my paycheck. I started with them in 1983. A teacher from that ‘era’ tells me that she remembers opting into Medicare. I remember no such option ( I was not married and would not have refused Medicare )and at the time, I did not even know Medicare deductions should even show or Not show on my paycheck.
    Is this a payroll oversight? A Human Resources oversight..A Medicare government oversight- And, more importantly, what can I do about this??
    All I know right now at 64.9 years old, after having taught for more than 30 years, I am paying out of pocket for my Medicare...
    Are all school districts required to take out Medicare ?
  • Not my area of expertise but I can safely say that this is a rule that 99% of payroll professionals have never heard of. I have heard of it since it is mentioned in the Payroll Source Book, but since I have always been private sector, I read the rule once, and made no effort to remember it. A large payroll department that was also government sector would have one, maybe two people who SHOULD know the rule, plus about the same number of people in HR.

    You can try calling your former employer but you need the benefit manager (HR) or payroll manager. This is not something a low level staffer would likely know. When a payroll system is set up, this is one of of maybe 1,000 questions answered during setup, and you do not let staff change your setups. The system is very locked down and one or two people tops should have access.

    If the company will not help you, and if they messed up, they might not want to your choices are talking to Medicare and talking to a labor law attorney. I would not expect an easy answer here. This is a train wreck situation.

  • Thanks. Appreciate your time.
    Train wreck...
    Dang. Labor law.. attorney..,
    Merry Mess- mas!
  • One thing to look at from the benefit side --> Is there any chance that your pension plan also have grandfathered health coverage?

    If not, i suspect at some point you had and option (not mandatory prior to 1986) and it never started. I do know many young employees who would opt out because retirement seems so far away and why pay into some optional benefit now? I suspect your employer will have some type of paperwork to back up their reasoning. If they can not provide that, then yes, I would check with an attorney who is familiar with Medicare in the 1980s for teachers.

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