This FAQ provides answers to common questions in situations where you have COBRA coverage and also qualify for Medicare.
What is COBRA coverage?
COBRA stands for Consolidated Omnibus Budget Reconciliation Act, a federal law that provides employees with the right to continue coverage under a group health plan even after leaving an employer. They can choose not to do so and get healthcare coverage elsewhere.
The employer company should have 20 or more employees, for COBRA to apply. Typically COBRA coverage lasts for up to 18 months, though States can increase this time period. You will have to bear the entire cost of COBRA coverage and may end up paying much more than what you were paying earlier, since you will be paying both the employee and employer portions of the monthly premium.
Between COBRA and Medicare, which is better?
Medicare is a federal program which is funded by taxes you paid into the system while working. So your share of Medicare costs will typically be lower than similar coverage under COBRA.
However, note that Medicare Part A and Part B have coverage limitations e.g. they do not cover prescription drugs, dental care, vision or hearing. Medicare Advantage, Part C, plans may offer additional benefits. Part D plans and many Part C plans offer prescription drug coverage. If COBRA can plug in some of the gaps in your Medicare coverage, it may be worthwhile to consider.
COBRA coverage is costing me a lot, what do I do?
You may want to consider enrolling in Medicare plans (which are cheaper since the federal government pays part of the cost) and using COBRA to plug in any gaps in coverage.
What happens when my COBRA coverage ends? Can I enroll in Medicare then?
End of COBRA coverage is a qualifying event, entitling you to a Special Enrollment Period (SEP) during which you can enroll in Medicare without paying late penalties.
Can I get Medicare coverage but still keep COBRA for dental, vision or hearing care?
Refer to above.
Click here to learn more about Medicare, its various Parts, different enrollment periods and your costs.
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Remember that you cannot choose just any combination of Parts and Plans. Let Lighted Road Insurance guide you step-by-step through the Medicare ecosystem and help you in selecting the right plan(s) for your needs.
Retirees with health benefits
Veteran Benefits / TRICARE