Jeffrey Wade
Medicare and COBRA can work together, but it's important to understand how they interact. COBRA, or the Consolidated Omnibus Budget Reconciliation Act, provides health insurance to employees who have lost their coverage due to certain situations, such as a reduction in work hours or unemployment. If you have COBRA before enrolling in Medicare, your COBRA coverage will typically end once you sign up for Medicare. It's important to consider your budget, medical needs, and family situation when choosing between COBRA, Medicare, or a combination of both. Medicare will be your primary insurer, with COBRA as the secondary payer. While COBRA can cover services that Original Medicare doesn't, it is generally more expensive.
| Characteristics | Values |
|---|---|
| What is COBRA? | The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that lets employees keep their employer group health plan coverage for a limited time after their employment ends. |
| Who does COBRA apply to? | COBRA generally applies to employers with 20 or more employees. However, some states have mini-COBRA laws that apply to employers with fewer than 20 employees. |
| How does COBRA interact with Medicare? | If you have COBRA before signing up for Medicare, your COBRA coverage will likely end once you sign up for Medicare. If you have Medicare before enrolling in COBRA, you can have both. |
| What if I have dental or vision coverage through COBRA? | You may be able to keep COBRA coverage for services that Medicare does not cover, such as dental or vision care. |
| How do I cancel my COBRA coverage? | If you no longer want your COBRA coverage, you can cancel it with the providing insurance company. An information packet from your former company's HR department should provide instructions. |
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What You'll Learn
Medicare eligibility and COBRA
Medicare is a federal government health insurance program that provides health care coverage if you are 65 or older, are under 65 and receive Social Security Disability Insurance (SSDI) for 24 months, begin receiving SSDI due to ALS/Lou Gehrig's Disease, or have End-Stage Renal Disease (ESRD) regardless of age.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that allows individuals to maintain their employer-sponsored health insurance coverage for a limited period following their departure from a company with 20 or more employees. Some states have mini-COBRA laws that apply to smaller companies.
If you have COBRA coverage and become eligible for Medicare, your COBRA benefits will typically cease, and Medicare will become your primary insurer. You have up to 8 months after losing your health insurance to sign up for Medicare Part B without penalty. If you miss this deadline, you will have to wait until the next enrollment period, which could result in a gap in your coverage and late enrollment penalties.
If you have Medicare and then become eligible for COBRA, you can have both, with Medicare as your primary insurer and COBRA as secondary. COBRA may cover services that Medicare does not, or it may cover them at a lower cost. However, COBRA is typically expensive, so you should consider your budget, medical needs, and family situation when comparing your options.
If you have questions about how COBRA will impact your Medicare coverage, you can contact your State Health Insurance Assistance Program (SHIP) or the Benefits Coordination & Recovery Center (BCRC).
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Cancelling COBRA coverage
If you are using both Medicare and COBRA insurance together, you can cancel your COBRA coverage at any time. COBRA coverage is month-to-month, so you can cancel whenever you choose.
To cancel your COBRA plan, you must notify your previous employer or the plan administrator in writing, requesting to terminate the insurance. You will need to send a letter to the plan administrator requesting termination of your COBRA coverage. This is usually the same party to whom you've made your premium payments. You can also cancel your coverage by refraining from making a monthly premium payment, although this is not the most efficient way to cancel. If you choose to cancel your coverage, it cannot be reinstated.
After you stop your COBRA insurance, your former employer should send you a letter affirming the termination of your health insurance. You should then receive a certificate of credible coverage for the length of time you were on the plan.
Please note that cancellation does not trigger a special enrollment period for new health insurance. This means you’ll need to wait until the next open enrollment period to secure new coverage or explore other options, such as enrolling in a marketplace plan, getting health insurance as an employee-sponsored benefit, or obtaining coverage through a spouse’s work insurance plan.
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Gaps in coverage
If you only have Medicare Part A and want to choose COBRA, you should consider enrolling in Part B during your Special Enrollment Period. If you do not enroll in both Parts A and B, COBRA may refuse to pay your claims. Not signing up for Part B during the special enrollment period may result in late enrollment penalties.
COBRA is a federal law that allows eligible employees and their spouses or dependents to maintain their employer-sponsored health insurance coverage for a limited time after certain qualifying events, such as job loss or divorce. The length of coverage varies, but it is typically up to 36 months. Medicare, on the other hand, is a federal health insurance program for individuals over 65 or with specific disabilities.
If you are on Medicare and become eligible for COBRA, you can elect to have COBRA as your secondary insurance. In this case, it is important to note that COBRA plans may cover services that Original Medicare does not, or it might cover them at a lower cost. Therefore, having both can provide more comprehensive coverage. However, you should carefully consider your budget, medical needs, and family situation when deciding whether to use COBRA, Medicare, or both together.
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COBRA and Medicare costs
The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that allows employees to keep their employer-provided health insurance for a limited time after their employment ends. This also applies to those who lose coverage as a spouse or dependent of the covered employee. In general, COBRA only applies to employers with 20 or more employees, although some states have mini-COBRA laws that cover smaller businesses.
COBRA and Medicare can be used together to meet an individual's or family's health needs. However, Medicare is always the primary payer in this scenario, and COBRA might only pay for a small portion of the costs. A COBRA plan may cover services that Original Medicare does not, or it may cover them at a lower cost. For example, COBRA is likely to include coverage for medications, whereas Medicare Part D plans vary by insurer and location.
The average COBRA premium for an individual is around $600 a month, with higher costs for families. There is also usually a deductible that must be met before coverage begins. By contrast, most people do not pay a premium for Medicare Part A, although there is a deductible of $1,676 a year. For Medicare Part B, most people pay a standard premium of $185 (as of 2025) and a deductible of $275. People with higher incomes may pay more for Medicare Part B.
If an individual is enrolled in Original Medicare, they may be able to save money by purchasing a supplemental Medigap plan to cover additional costs, which may be less expensive than COBRA.
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Keeping COBRA benefits that Medicare doesn't cover
The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that allows employees to keep their employer-provided health insurance for a limited time after leaving their job. This can be particularly useful if you're approaching the age of Medicare eligibility (65 years) and want to ensure continuous health coverage.
If you have both COBRA and Medicare, Medicare becomes your primary payer, and COBRA acts as secondary coverage. This means that Medicare will pay for any covered services first, and then COBRA will cover additional costs or benefits that Medicare doesn't cover. This can be advantageous as COBRA plans often cover services that Original Medicare doesn't, or they may cover them at a lower cost.
It's important to note that if you have COBRA before signing up for Medicare, your COBRA coverage will likely end once you enrol in Medicare. Therefore, it's essential to carefully consider your options and compare the costs and benefits of both before making a decision. Additionally, you have up to 8 months after losing your health insurance or leaving your job to sign up for Medicare Part B without a late enrollment penalty.
To maintain COBRA benefits that Medicare doesn't cover, you can keep your COBRA coverage as secondary insurance. This way, you'll have the added security of knowing that certain services or medications not covered by Medicare may still be covered by your COBRA plan. However, it's important to review the specific details of your COBRA plan and compare them with your Medicare coverage to understand the benefits offered by each.
Additionally, some states have mini-COBRA laws that apply to employers with fewer than 20 employees, allowing you to keep your coverage for a limited time. If you believe you may be eligible for COBRA due to a change in your marital or dependent status, be sure to notify your employer's benefits administrator within 60 days of the change.
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Frequently asked questions
Yes, you can have both Medicare and COBRA. Medicare will be your primary insurer and COBRA will be your secondary.
If you have COBRA when you become eligible for Medicare, your COBRA coverage will usually end.
If you have Medicare before signing up for COBRA, your COBRA will probably end once you sign up.
For most people, COBRA will be significantly more expensive than Medicare. The average COBRA premium for an individual is around $600 a month, while Medicare is usually free.
COBRA and Medicare can work well together, as COBRA might cover services that Medicare doesn’t, or it might cover them at a lower cost.
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