Can COBRA plan drop me if I chose not to accept Medicare?

[Guest Jtomiser]

I've looked everywhere but can't find an answer to predicament. Let me explain:

1. I am disabled and have never enrolled in Medicare because I've always been covered by my husband's insurance.

2. My husband lost his job and I enrolled in COBRA

3. That was 10 months ago. Now the COBRA administrator tells me that they're not going to cover me because I'm eligible for COBRA. Not "entitled", which I understand to mean receiving Medicare benefits, but "eligible".

4. I looked into enrolling in Medicare 10 months ago and Medicare said even if I were to enroll during the general enrollment period, I could not receive benefits until the following July.

My question is, can the COBRA administrator do this? Can I really be required to opt into Medicare rather than COBRA?

Thanks so much, I'm really confused on this.

[oriecat]

No, they are wrong.

Here is the law:

http://edocket.access.gpo.gov/cfr_2005/apr...r54.4980B-7.htm

26CFR 54.4980B-7

Q-3: When may a plan terminate a qualified beneficiary's COBRA

continuation coverage due to the qualified beneficiary's entitlement to

Medicare benefits?

A-3: (a) If a qualified beneficiary first becomes entitled to

Medicare benefits under Title XVIII of the Social Security Act (42

U.S.C. 1395-1395ggg) after the date on which COBRA continuation coverage

is elected for the qualified beneficiary, then the plan may terminate

the qualified beneficiary's COBRA continuation coverage upon the date on

which the qualified beneficiary becomes so entitled. By contrast, if a

qualified beneficiary first becomes entitled to Medicare benefits on or

before the date that COBRA continuation coverage is elected, then the

qualified beneficiary's entitlement to Medicare benefits cannot be a

basis for terminating the qualified beneficiary's COBRA continuation

coverage.

(b) A qualified beneficiary becomes entitled to Medicare benefits

upon the effective date of enrollment in either part A or B, whichever

occurs earlier. Thus, merely being eligible to enroll in Medicare does

not constitute being entitled to Medicare benefits.

[GMK]

Excellent reference, oriecat.

Most general literature and other documents say "eligible for Medicare," which to most people means or appears to mean old enough (or otherwise eligible) to enroll in Medicare. Causes big confusion.

[oriecat]

Yeah, it would be so easier if everything would forget that confusing "entitled" word and just use "enrolled".

[Guest Jtomiser]

Sorry I actually said eligible for "COBRA" when I meant to say Medicare, but it looks like you all got the picture.

New info: It seems that since I collect SSI I was automatically enrolled in Medicare Part A 15 years ago. That was news to me. Anyway, Aetna now says they'll only pay secondary COBRA benefits even though I'm not enrolled in Part B. They only recently became aware when I tried to get coverage for a wheelchair. I guess that expense raised a red flag for them. No they say they're going to go back and collect money from all the providers because Medicare should have been primary (even though I'm not now, nor have ever been enrolled in Medicare Part B).

But shouldn't the COBRA administrator notified me of this provision in the plan? When I enrolled a year ago I received nothing that referenced it. They were still happy to take the money for 12 months. Do they not have any responsibility here?

[oriecat]

If you had the Medicare prior to the COBRA, they still can't kick you off of COBRA, you can have both (as explained in the Q-A I posted already). Which one is primary becomes a whole new question that we probably don't have enough information to answer.

[Guest Jtomiser]

Thanks for the replies by the way. Oriecat - that's exactly right, they have not kicked me off COBRA though I thought they had after speaking to the manager. What they're really saying is there's a provision in the plan that says they can make Medicare Part B primary even if I don't have it and even though I'm not required to have it by law. Essentially, the plan reserves the right to assume I have the Part B coverage and not pay primary. In other words, they can just pretend I have it. Essentially, the law can't require me to buy Medicare but Aetna can (or else they'll slash the benefits I paid them for). Doesn't seem like it should be legal but I guess it is.

The big question for me now is whether I'll be permitted to read that plan provision and whether the COBRA administrator had any obligation to notify me of that provision when I signed up. My understanding is that they have a fidiciary duty to communicate the terms of the plan to the beneficiaries. After all, the plan is not out there for the reading, and even so the sponsor appears unwilling to make it available.

[oriecat]

You might want to review this booklet and call the Medicare Coordination of Benefits people and see what they have to say:

http://www.medicare.gov/publications/pubs/pdf/02179.pdf

From page 32 of the booklet

If you have questions about Medicare and COBRA, call the Medicare Coordination of Benefits Contractor at 1-800-999-1118.

[Guest Jtomiser]

I will look at that. Thanks again!

[Mary C]

The provisions of the plan are in the Plan summary plan description - the plan provisions do not change from active employee coverage to COBRA coverage - and since COBRA coverage must be identical to that you had while your spouse was employed, it has probably been in place since you signed up for coverage. Your COBRA administration may not have the information you are looking for, but your husband's former employer would. And no, COBRA administrators are NOT required and do not have a fiduciary duty to inform you of the plan provisions - that's the previous employer's job.

I do question how the coordination of coverage provisions under an active plan can state they presume you are enrolled in Part B if eligible. I would assume that goes against the Medicare Secondary Payer regulations for active employee coverage. Once the coverage provided is under COBRA though, MSP provisions state Medicare is primary.

[LRDG]

Mary C, worth pointing out that COBRA in no way changes coverage received while an actively at work EE.

The fiduciary duty of the ER includes providing Plan Docs to participants with in 15? business days from receipt of written request, under penalty for failing to do so. DOL penalty is $150? per day?

Here is a link to DOL site for COBRA and health plans:

http://www.dol.gov/dol/topic/health-plans/cobra.htm

In addition to the link provided by oriecat:

http://edocket.access.gpo.gov/cfr_2005/apr...r54.4980B-7.htm

[Guest lisa4165]

I just came across this discussion and it seems like I am in an almost IDENTICAL situation:

1. I am disabled and didn't enroll in Medicare Part B because I had insurance through my husband.

2. He was terminated and we went on COBRA as of 5/1/09.

3. Aetna has been paying all my claims through the group insurance.

4. Yesterday I called Aetna because one of my claims had been flagged as needing "more information." After the rep asked me questions about my Medicare eligibility, she announced that Medicare should have been primary all along and that Aetna will pay secondary as if I had been paid my Medicare, even though I haven't. She said they'll need to go back into my past claims to "correct" them.

I was never told anything about coordination of benefits with Medicare when I enrolled in COBRA. I declined to enroll in Medicare Part B because I thought that the COBRA plan (at $500/mo. individual) gave me better coverage and made the other coverage redundant.

My question is: was the COBRA administrator responsible for informing me that Aetna would pay as if I'm receiving Medicare benefits, whether or not I do? I never received an SPD when the company switched to Aetna (from Anthem Blue Cross) as of 4/1/09. I was given a brochure about the Aetna plan, but no SPD or anythiing that had information about coordination of Medicare benefits.

Any help would be appreciated.

[masteff]

Lisa - this is probably the best to start with:

You might want to review this booklet and call the Medicare Coordination of Benefits people and see what they have to say:

http://www.medicare.gov/publications/pubs/pdf/02179.pdf

From page 32 of the booklet

If you have questions about Medicare and COBRA, call the Medicare Coordination of Benefits Contractor at 1-800-999-1118.

[Chaz]

The Medicare regulations state that Medicare is primary to COBRA continuation coverage when Medicare coverage is based on age or disability. Aetna can't cut off the COBRA coverage but it appears from the facts you present that they are correct that Medicare pays first.

[oriecat]

But how can Medicare pay first if she is not enrolled? Or did I misunderstand something?

EDIT: Unless she was also automatically enrolled in Part A, like the first poster. I forgot about that part.

[GMK]

You got it, oriecat.

People enroll in Part A. It doesn't cost anything and doesn't pay anything while you have employer plan coverage, but if an emergency creates the need for Part B, you don't have to wait 3 months to complete your enrollment. You're already in the system and just add the coverage(s) you need. Or so I'm told.

[Guest lisa4165]

Thanks for the responses. I reached out to the COBRA administrator (my husband's previous employer's HR dept.), who contacted the broker and then the Aetna liason. Now everything has been resolved! I'm still not completely clear on what happened--apparently the Aetna rep I talked to on the phone was misinformed and Aetna cannot be secondary when I am not enrolled in Medicare Part B. The Aetna account manager has now assured me of the following:

Medicare Part A is secondary, and Aetna is Primary

All the claims were originally paid correctyl and the advice from member services should be disregarded.

A manager will "re-educate" the Member Service rep that spoke with me.

Needless to say I am relieved. And I hope that the individual who initially posted this thread had her situation similarly resolved.

[Guest mschwab67]

Please someone help this is the same thing that is happening to me, and I can not get the Employer to admit that medicare cannot be primary if I do not have Part B. I have Part A and was insured through my husbands employer since 2002 he lost his job and I elected cobra. They are now saying they do not want to cover part b services because medicare is primary not cobra. I am wondering how to straighten this out!! PLEASE HELP I see lisa4165 finally got some results, can anyone point me in the right direction before it is too late! Cobra is telling me I must sign up for medicare partB or they will not cover my services they want to cover as if I did have partB. I agree with Oriecat how can medicare be primary for partb services when I do not have part b!!!

[GBurns]

Have you called Medicare/SSA ? Or done as lisa did, call the insurance company itself?

[foggyjack]

Hello! I came across this discussion when researching about Medicare with COBRA online. My situation is not the exact same as Guest Jtomiser and Guest Lisa4165 and Guest mschwab67 because I am not disabled, but otherwise I am in a similar predicament.  

I realize this discussion is from 04/2010 through 03/2011 and I have not received the same positive results that 'Guest Lisa4165' had in 2010. However, I've received so many different responses from everyone I've contacted about my current dilemma that I'm posting here to possibly acquire more concrete information and/or how to proceed (or) if I’m just screwed.  

I’m also posting this ‘mini novel’ because I don’t want anyone else to go through this and if even 1 person reads my story on this website and they are 65 or older when choosing COBRA, hopefully, they will know they must sign up for Medicare Part B if they choose COBRA.   

Here is my story in detail…

I turned 67 in April 2024 - my husband is 64. We had health insurance through my husband's employer when I turned 65 in April 2022, so I only enrolled in Medicare Part A. I was told by both Medicare and Social Security since I was covered under my husband's employer’s medical insurance, I could delay Medicare Part B enrollment without penalty, which I did. 

My husband left his job in July of 2023, and we accepted his former employer's COBRA insurance. Thankfully, I am a very healthy 67-year-old, and rarely get sick - I use food and exercise as medicine – no drugs – not even Tylenol. Hence, I had not even used our COBRA Medical insurance (Cigna Platinum Plus) since we initially enrolled in COBRA in August 2023.  

Since enrolling in COBRA in August, I’d only used our Delta Dental for bi-annual teeth cleaning and for my Orthodontist (Invisalign). In early March 2024, my husband and I set up our eye exam appointments to see the Ophthalmologist on March 21^st. We both did the routine comprehensive eye exam & routine refraction, but I also had a Posterior: Retina test and we both got new reader prescription glasses.  

We have EyeMed for Vision Insurance and receive their EOBs electronically. For Cigna Medical & Delta Dental, we receive paper EOBs, but can also look at them online. About a month after our 3/21 eye exam appointments, I received a paper EOB from Cigna Medical in the mail, which was strange because I’d only had the eye exam & glasses appointments. The Cigna Medical EOB was for my eye exam/ophthalmologist appointment on March 21^st, so I immediately looked at our EyeMed (Vision) online accounts. My EyeMed account only had (1) EOB for the new glasses.  My husband’s EyeMed account had (2) EOBs – one for his new glasses and one for his comprehensive eye exam/routine refraction. Also, on my EyeMed online account, it was boldly stated that I was due for a comprehensive eye exam, which I’d just had on 3/21.  

I called EyeMed, and confirmed EyeMed had no claim for me for my eye exam/ophthalmologist appointment on March 21^st  - they did not – EyeMed only had the claim for my new glasses.  The EyeMed rep said to call the eye doctor’s insurance/claims department and have them send the eye exam claim to EyeMed.  

 

I called my eye doctor’s claim/insurance department and they said because I also had the Posterior Retina test that made my full eye exam claim a medical insurance claim, not a vision insurance claim.  I asked her to resend the claim to EyeMed and to change the code. She said she would resend it manually through fax with notes, but that she could not change the ‘code’- she also said, with the medical code, if she resent the claim to EyeMed electronically, the system would automatically deny it again due to the medical code.

I called Cigna that same day – the agent I spoke to was not in a US call center and I had trouble understanding him, but I wanted to make sure Cigna knew and noted on my account that I had enrolled in Medicare Part A on 4/01/2022. The Cigna agent seemed as confused as I was, and I didn’t receive any additional information or help from him about my situation. But he also thought my eye exam claim should have been paid through our vision insurance (EyeMed) and not through our medical insurance (Cigna).  

On Saturday, May 4^th, I received a bill in the mail from the Ophthalmologist’s office. On the bill, it also showed that I owed the $140.40 and the doctor’s office added the note that was on my Cigna EOE (my doctor’s bill stated: “Cigna’s records show you have not signed up for Medicare. You are responsible for paying the amount Medicare would have paid.”).

On Monday, May 6^th, I called my husband’s former company’s Cobra administrator  (I don’t want to mention the name of my husband’s former company or its benefit’s administrator company because his former company is a huge international company that everyone knows – same with the benefit’s company).  After several days and many hours on the phone with both the Cobra administrator and Cigna (3-way calls included), is when I learned (literally felt like I’d been punched in the gut) all about the ‘primary and secondary’ insurance if you’re 65 or over and go on COBRA.  

Call me ignorant if you please (I’m not, but certainly feel that way now after this situation), but we’ve always just had company sponsored medical benefits – we’d never had (2) medical insurance policies at the same time or Cobra. Yes, I’ve heard the terms, ‘primary & secondary’ insurance before, but I obviously didn’t understand what that meant. In my mind, it just meant the primary insurance is billed 1^st and what isn’t paid by it, the secondary kicks in and pays remainder up to our policy limits (less our deductibles, co-pays, and OOP max). I had no idea that it meant the primary was responsible for 80% and the secondary was responsible for 20%, and because I did not have Medicare Part B, that I’m responsible for the full 80%. Obviously, had I understood this, I’d have immediately signed up for Medicare Part B. Who would pay as much money as we are paying monthly to only have 20% coverage (?!?!) when for an additional $175, I’d have proper coverage?

We pay $2,658.15 monthly for COBRA (with my share as spouse being the bulk at $1,544.73), and I only had this (1) claim/payment by Cigna for $35.10 since our COBRA started on 08/01/2023.

My husband’s former employer only allowed us to “Call” to enroll in COBRA in August 2023 - we couldn’t enroll online like we did when active, but still have access to the company’s benefits’ website and we can do all other benefits related actions online like pay for COBRA, etc. My husband’s former company uses the same benefit’s administrator for active employees as it does for COBRA administration. When calling to enroll, we were told that the company had stopped allowing their retired/terminated employees to enroll in COBRA online because they wanted to make sure Cobra eligible employees/dependents understood everything. 

However, when enrolling in August 2023 (I did it on my home phone line with CSA on speaker and my husband also in the room) – I had to give the CSA both our birthdays, etc., so the agent knew I had just recently turned 65; however, knowing I was 65, the agent never explained that COBRA insurance for me would not work the same as when my husband was actively employed. The CSA did not tell me that my coverage now would be secondary and would only pay 20% - period. The CSA did not ask if I was enrolled in Medicare Part B and did not tell me if I wanted our insurance to work as it did when husband was employed that I needed to enroll in Medicare Part B. Quite the opposite – I asked a bunch of questions, and we were assured our health insurance on COBRA was the exact same as when my husband was employed and would work (exactly) the same for both of us.

For 2024 Open Enrollment that opened in October 2023, again we were only allowed to enroll/make any changes to employers’ many other medical, dental and vision plans on the phone with the benefit administrator’s Customer Service Agent. Since we were able to make any changes to the former employers’ many, many other medical, dental, and vision plans for 2024, I had a lot of questions; hence, I requested a skilled ‘COBRA’ Supervisor only to enroll us.  

We were transferred to a supervisor that was supposedly a ‘COBRA’ expert and she enrolled us for 2024. After the supervisor answered all our questions about the company’s different and less expensive options, I immediately told the supervisor/agent that we want the exact same Medical, Dental and Vision plans that we’d had – no changes from the prior year. My husband and I have always chosen to pay for the more expensive options with more coverage/less OOP when actively employed and when on COBRA because we prefer to pay higher monthly premiums vs paying higher deductibles, copays, and OOP maximums throughout the year.  

Before the supervisor would even begin the conversation, I was asked to give her our birthdates, and other personal information to proceed. I asked the benefit’s Supervisor if our COBRA insurance was the exact insurance (coverage, deductibles, copays, OOP maximums, etc.) that both my husband and I had while he was employed and she responded, “Yes”. 

I didn’t stop there – I gave our COBRA administrator’s Supervisor scenarios and asked her if all the %’s paid by Cigna were the same, if all our deductibles, copays and OOP maximums were the same for both of us as they were when my husband was an active employee (?) – again, she responded, “Yes”. I asked if we needed to let any doctors, clinics, hospitals, etc. know that our insurance now was COBRA insurance and was no longer active employee group insurance? The Supervisor told us “No” - we did not have to tell anyone that our insurance was now COBRA insurance because our insurance worked exactly as it did when my husband was actively employed. I had also asked her if our insurance would cover less or if providers would be hesitant to service either of us since the insurance was now COBRA?  Her response again was, “No, you don’t need to tell providers your insurance is COBRA and, no, your insurance coverage is exactly as when actively employed and pays exactly the same as when actively employed”.  

I have this supervisor’s name and the date we enrolled.  Supposedly, all phone calls are recorded, and I’m still waiting on the company’s ‘health pro advocate’ to call me – ha – this all happened 2 months ago. I had been conversing with another benefit’s administrator Supervisor. This supervisor finally admitted to me that because I don’t have Medicare Part B, that if I ever use this Cigna medical insurance that Cigna will only pay up to 20% and I will be responsible for the 80% that Medicare would have possibly paid. For days, I had been asking this question to everyone I’d spoken to at the benefit’s administration company and at Cigna (BTW – I put in a formal request over 2-months ago with a Cigna CSA to have a Cigna Manager call me – nobody from Cigna has ever called me). Why would my husband’s former employer’s COBRA Administrator and Cigna not want to immediately answer this question?

This same benefit’s administrator supervisor also told me that the supervisor that did enroll us in October 2023 should have informed me that because I was 65 and entitled to Medicare that my COBRA medical insurance would not work the same unless I enrolled in Medicare Part B (again, supposedly all calls are recorded so I was surprised that she did admit this).  

Additionally, this supervisor has already called us to offer 3 months reimbursement for our last 3-months of my portion of COBRA payments (when we asked why not reimburse all the months’ payments for my portion since August 2023 due to the inaccurate information given, less the $35.10 amount CIGNA has paid for me since we started COBRA in Aug 2023, her answer was because all those business quarters had already closed their books. Currently our COBRA is paid through the end of July 2024. We are surprised they offered to reimburse us for anything though - is this even normal?  We’re wondering if they do record all phone calls and if they reviewed the recordings?  Should we pursue this and/or hire an attorney? 

March 31, 2024, was my 8-month SEP deadline to enroll in Medicare Part B. I called Medicare and they suggested that I call the national SS phone to set up an appointment with my local SS office so I could try to plead for an exception. My appointment is Friday, June 28^th – it took 7-weeks to even be able to get an appointment at our local SS office (the national agent said they’re short staffed nationwide). The agent said because I missed my SEP, I can’t enroll in Medicare Part B until January - March 2025 and that my Medicare Part B won’t activate until July of 2025. I still have not received a firm answer from Social Security or Medicare if I will be penalized from August 2023-July 2025 (or) from August 2023-July 2025 when my Medicare Part B would commence?  Would any of you know the answer to this?

Even more disheartening is my husband decided to take a job with a local family-owned business in mid-January (he was commuting over an hour to/from at his former job and we’d already planned he’d retire next year at 65). His current employer offers benefits, but we had to enroll by March 31, 2024! It’s ironic that this deadline is also my 8-month SEP deadline for Medicare Part B enrollment.  

Since we were unaware of my current situation with the COBRA insurance & not being enrolled in Medicare Part B, we waived his current employer’s insurance for 2024. If we had realized all of this, we’d have either enrolled me in Medicare Part B with our current COBRA (or) we would have dropped COBRA and enrolled in my husband’s current employer’s health insurance. With either of these options, I’d now have proper health insurance coverage and I would not be penalized for life for Medicare Part B. 

After this mini novel, I guess I’m still confused as to why Guest Lisa4165’s insurance company (Aetna) ended up switching her primary/secondary insurance payments to her COBRA insurance (Aetna) being/paying as Primary, and her Medicare (Part A only) paying as Secondary? Is this because she was on Disability (she too was 65 or over)?  

If being on Disability was not the reason Guest Lisa4165’s husband’s former employer ended up keeping their COBRA insurance as Primary, and they did reconsider due to her not being enrolled in Medicare Part B, should we call my husband’s former employer and use the same argument as she used?

Is this a company’s decision on which pays primary/secondary? Or is this current federal law in all situations?

Lastly, I kept every single piece of paper received from hubby’s former employer and even after rereading all of it when becoming aware of my situation, I still think the DOL approved language isn’t enough – there are just too many words used that can still make a person think it doesn’t pertain to them if they are enrolled in Medicare Part A (words like: ‘or’, ‘and’, ‘generally’, ‘may’). 

Below is the DOL language that is in our COBRA paperwork from my husband’s former employer…I still don’t think it is clear enough. I feel companies and/or their benefit’s administrators should be mandated to inform any former employees and their dependents (65 or over) that the insurance they are paying full cost + administration fees for is not the same and does not work/pay the same if they are 65 or over. They should also be mandated to inform that any former employees & employee’s dependents 65 or over that they must purchase Medicare Part B, and if they don’t purchase it, they will be responsible for the remaining 80%. They should be mandated to disclose/use language that clearly informs that without purchasing Medicare Part B too that purchasing COBRA insurance means they are purchasing insurance that will now only be responsible for paying up to 20%. Bottom line – IT’S JUST NOT CLEAR ENOUGH!

Here is the exact DOL language in our COBRA paperwork:

“When does COBRA coverage become effective?

Once you enroll in COBRA coverage and make your first payment, coverage is effective retroactive to the date your active group health coverage ended. A number of factors can impact how quickly your COBRA enrollment is completed, as the following chart shows.

Other Coverage Options

When you lose group health coverage, there may be other, more affordable coverage options for you and your family through the Health Insurance Marketplace, Medicare, Medicaid, Children's Health Insurance Program (CHIP), or other group health plancoverage options (such as a spouse's plan) through what is called a "special enrollment period." By enrolling in coverage through the Marketplace, you may qualify for lower costs on your monthly premiums and lower out-of-pocket costs. Additionally, you may qualify for a 30-day special enrollment period for another group health plan for which you are eligible (such as a spouse's plan), even if that plan generally doesn't accept late enrollees. Some of these options may cost less than COBRA continuation coverage.You can learn more about many of these options at www.HealthCare.gov.

Can I enroll in Medicare instead of COBRA continuation coverage after my group health plan coverage ends?

In general, if you don't enroll in Medicare Part A or B when you are first eligible because you are still employed, after the Medicare initial enrollment period, you have an 8-month special enrollment period111 to sign up for Medicare Part A or B, beginning on the earlier of

 

■     The month after your employment ends; or

■     The month after group health plan coverage based on current employment ends.

 

If you don't enroll in Medicare and elect COBRA continuation coverage instead, you may have to pay a Part B late enrollment penalty and you may have a gap in coverage if you decide you want Part B later. If you elect COBRA continuation coverage and later enroll in Medicare Part A or B before the COBRA continuation coverage ends, the Plan may terminate your continuation coverage. However, if Medicare Part A or B is effective on or before the date of the COBRA election, COBRA coverage may not be discontinued on account of Medicare entitlement, even if you enroll in the other part of Medicare after the date of the election of COBRA coverage.                                                                                                                                                                If you are enrolled in both COBRA continuation coverage and Medicare, Medicare will generally pay first (primary payer) and COBRA continuation coverage will pay second. Certain plans may pay as if secondary to Medicare, even if you are not enrolled in Medicare.

 

For more information visit https://www.medicare.gov/medicare-and-you.

 

111https://www.medicare.gov/sign-up-change-plans/how-do-i-get-parts-a-b/part-a-part-b-sign-up-periods. These rules are different for people with End Stage Renal Disease (ESRD).”

 

 

 

 

 

[Brian Gilmore]

I'm sorry to hear about your situation @foggyjack.  Thanks for sharing to help others avoid the same predicament.

The small sliver of good news is the DOL's model COBRA election notice was updated recently to incorporate this information.

Here's the new language:

https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/cobra

If you are enrolled in both COBRA continuation coverage and Medicare, Medicare will generally pay first (primary payer) and COBRA will pay second.  Certain COBRA continuation coverage plans may pay as if secondary to Medicare, even if you are not enrolled in Medicare.

For more information visit https://www.medicare.gov/medicare-and-you.

 

Here's the summary I recently shared on this topic:

https://www.newfront.com/blog/the-medicare-form-cms-l564-for-employers

Medicare Pays Primary (COBRA Assumes Primary Medicare Payment—Even If Not Enrolled!)

Perhaps the most significant reason a post-65 retiree should avoid relying solely on COBRA for any period is that COBRA will likely provide only secondary coverage.  In general, the MSP rules require that the employer-sponsored group health plan always pay primary to Medicare for individuals in “current employment status,” which applies to active coverage. 

However, retirees enrolled in COBRA are not receiving employer-sponsored coverage based on “current employment status.”  In other words, they are not enrolled in active coverage.  This means that Medicare pays primary for anyone enrolled in COBRA.

In the COBRA context where the MSP rules do not apply and Medicare is primary, the plan can assume the Medicare payment rate and pay only as secondary coverage for any individual who is eligible for COBRA.  This is true regardless of whether the individual is actually enrolled in Medicare.

For example, if an individual’s services would have been covered primary by Medicare if the participant were enrolled in Part B, COBRA coverage can pay only the amount that a secondary plan would pay.  For individuals not enrolled in Part B, that leaves the amount that would have been paid by Part B as a coverage gap for which the participant is responsible.

Medicare-eligible retirees will therefore never want to be in a position where they fail to enroll in Medicare while enrolled in COBRA under a plan that assumes the Medicare primary payment rate regardless of actual Medicare enrollment.

 

Here's a quick slide summary:

2024 Newfront Medicare for Employers Guide

[foggyjack]

Brian,

Thank you SO much for your response and this updated information!  This is great news!  It truly makes me happy to hear this update because I felt really 'un-smart' when this happened to me.  Thankfully, I'm healthy and blessed financially to better afford to pay for a doctor, etc if needed until January 2025 when we're able to enroll in husband's employer benefits.  But many others are not currently healthy or financially able to afford immediate healthcare - not to mention that the cutoff for Medicaid benefits is really low.  This updated DOL language is much clearer and should help a lot going forward.  I appreciate you reading my novel and responding.  Best!