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COBRA and Medicare: COBRA doesn't let you put off Part B

COBRA can keep your old job's health plan going after you leave. It doesn't move your Medicare deadline. If you're 65 or older, your time to sign up for Part B starts when you stop working, not when COBRA ends.

Work out your Part B deadline

What's your date of birth?

Every deadline is counted from it.

What's your last month of work, with your job's health plan?

The month your job ends, before any COBRA. A guess is fine.

The rule

  • Once you stop working, or lose your job’s health insurance if that happens first, you have 8 months to sign up for Part B without a penalty. That’s true whether or not you choose COBRA.
  • COBRA doesn’t extend that time. Don’t wait until COBRA ends to sign up.
  • Only health coverage from a job that you or your spouse still hold, at an employer with 20 or more employees, lets you wait past 65. COBRA and retiree coverage don’t.

Source: Medicare.gov: COBRA coverage · Medicare.gov: Working past 65

What missing it costs

Miss the 8 months and you have to wait for the General Enrollment Period, January 1 to March 31, with coverage from the month after you sign up. That can leave you with a gap. Part B then costs 10% more for each full 12 months you could have had it, for as long as you have Part B.

Source: Medicare.gov: COBRA coverage · Medicare.gov: Avoid late enrollment penalties

How COBRA works once Medicare is involved

  • If you’re eligible for Medicare but haven’t signed up, COBRA may pay only a small part of your costs, leaving you to pay most of them. Ask your COBRA plan what percent it pays.
  • If you have COBRA before you sign up for Medicare, your COBRA will probably end once you sign up.
  • If you got COBRA after you already had Medicare, COBRA pays after Medicare (unless you have End-Stage Renal Disease).
  • COBRA is generally offered for 18 months, and 36 in some cases.

Source: Medicare.gov: COBRA coverage · Medicare.gov: Working past 65

Turning 65 while you’re already on COBRA

COBRA doesn’t let you wait, so sign up in your first window: the 7 months around your 65th birthday. The enrollment calculator works out yours.

Source: Medicare.gov: When can I sign up? · Medicare.gov: Avoid late enrollment penalties

Drug coverage

After you leave coverage from an employer or union, including COBRA, you can join a Medicare drug plan until 2 full months after the month that coverage ends. Going 63 days or more without creditable drug coverage adds a Part D penalty for life, so keep the creditable coverage notice from your job’s plan: it shows your drug coverage was as good as Medicare’s.

Source: Medicare.gov: Special Enrollment Periods · Medicare.gov: Avoid late enrollment penalties

Who to ask

  • Your former employer’s benefits administrator, about your COBRA options.
  • Your state’s SHIP counselor, free, about how COBRA affects Part B and Medigap.
  • Medicare’s Benefits Coordination & Recovery Center, 1-855-798-2627, about COBRA and Medicare.

Source: Medicare.gov: COBRA coverage

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