COBRA and Medicare Insurance: Can The Two Be Coordinated?

COBRA and Medicare can be enrolled in simultaneously or in succession, depending on a person’s situation.

COBRA vs Medicare

Most people understand that Medicare is a federal program offering healthcare coverage to certain groups. There are several parts of Medicare, including Part A – hospital insurance, Part B – medical insurance, Part C – Medicare Advantage, and Part D – prescription drug coverage.

Some Medicare benefits are offered directly through the federal government while others, such as the Medicare Advantage Plan, are offered through a private company.

COBRA benefits are provided to workers under the Consolidated Omnibus Budget Reconciliation Act. Under COBRA, workers and their beneficiaries are able to continue their healthcare benefits for limited periods of time after a qualifying event.

The act allows workers to foot the bill for their continued healthcare insurance that they previously qualified for through their job. People may be required to pay for up to 102 percent of the cost to the plan when they continue coverage under COBRA.

COBRA and Medicare Eligibility

Both COBRA and Medicare eligibility can vary, but can generally be defined by several requirements.

Medicare is available for a variety of groups, including the following:

• people over the age of 65;
• individuals who are under 65 and have received Social Security disability benefits for at least 24 months (not necessarily consecutive);
• people who receive a disability pension from the Railroad Retirement Board and meet certain conditions;
• individuals who have Lou Gehrig’s disease or permanent kidney failure.

COBRA continuation coverage is available for qualified beneficiaries who were enrolled in a COBRA-covered group health plan following a qualifying event. Qualified beneficiaries include a covered employee, their spouse, or their dependent child. A variety of events qualify a person for COBRA coverage, including:

• job loss (voluntary or involuntary);
• reduction in hours;
• transition between jobs;
• death;
• divorce;
• loss of dependent child status;
• entitlement to Medicare.

COBRA and Medicare Coordination

In many cases, consumers may find themselves eligible for both COBRA and Medicare coordination. This may result in confusion about whether or not an individual can benefit from both plans and which insurance covers what items.

COBRA and Medicare: Which Coverage Came First?

When determining how COBRA and Medicare eligibility is coordinated, the most important piece of information is which coverage came first.

If you have COBRA insurance and later become Medicare-eligible, your COBRA coverage will typically end after you sign up for Medicare. However, you may be able to keep certain COBRA benefits (dental insurance, etc.) for things not covered by Medicare.

If you have Medicare (Part A or B coverage) and later become eligible for COBRA, you cannot be barred from enrolling in COBRA benefits. In this situation, Medicare is your primary insurance and COBRA provides secondary coverage.

It is not recommended that you drop Medicare when you qualify for COBRA for a variety of reasons. First, COBRA benefits are typically expensive since you are responsible for paying the premiums. Although this coverage is helpful for people with high medical expenses and Medicare cost-sharing, Medicare will still provide the majority of coverage for health care costs.

Common Scenarios

You may still be wondering: Who pays first when I have both COBRA and Medicare coverage? Unfortunately, this may vary widely depending on your specific situation. The following examples may help you get a better idea of COBRA and Medicare coordination of benefits.

For individuals who are aged 65 and older and are also eligible for a group health plan, the coverage depends on the size of their employer. For a person who works for a company with less than 20 employees, Medicare will pay primary healthcare costs while their group health plan will pay secondary costs. When a person works for an employer that has over 20 employees, their group health plan will pay primary healthcare costs while Medicare covers secondary costs.

Individuals who are over the age of 65 and are covered by both Medicare and COBRA will receive both benefits, although Medicare will pay primary costs and COBRA will pay secondary costs. Should a person be disabled and covered by both Medicare and COBRA, the same coverage order applies.

If someone is eligible for Medicare by virtue of having end-stage kidney failure and is also eligible for COBRA, their first 30 months of eligibility will pay as follows: COBRA pays primary medical costs, Medicare pays secondary costs.

Exact eligibility and coordination may vary. If individuals are confused about their coverage, they can contact their plan administrator or a Medicare representative for more information.

Join a Free COBRA Class Action Lawsuit Investigation

If you received a COBRA notice that did not fully disclose your rights and how to retain your health insurance following separation from your job, or you received no notice at all, you may be qualify to join this COBRA notice class action lawsuit investigation.

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This article is not legal advice. It is presented
for informational purposes only.