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Can I Use Both Medicare and COBRA?

Posted on: September 10th, 2012 by Kristen Marie

doctor and elder patientDue to the difference between Medicare coverage and COBRA coverage, many people want to know whether or not they are able to use COBRA and Medicare at the same time.  And the answer isn’t that simple unfortunately.  It depends on both why you qualified for Medicare and when you enrolled in COBRA coverage.

For people who qualify for Medicare coverage because of their age or a disability, being able to use both plans will be based on when you enrolled in COBRA and which plan you had first.

  • For people who were on COBRA insurance plans before they enrolled in Medicare, in most situations COBRA ends when you start Medicare.  If you already have COBRA when you enroll in Medicare, your COBRA coverage usually ends on the date you enroll in Medicare. However, if you are already on COBRA and become eligible for Medicare, it is always smart to enroll in Medicare Part B right away.  This is because there is no special enrollment period when your COBRA coverage comes to an end.  Any dependents or spouses on COBRA will be able to use it for up to 36 months due to your Medicare qualification.
  • If there are certain things that your Medicare plan does not cover, but your COBRA plan does cover, you may be able to keep a portion of your COBRA plan.  A common example of this is when someone has dental insurance through COBRA but Medicare doesn’t have the same dental offering.  Many plans will allow you to only keep the dental part with COBRA.  To find out if you are eligible, you should contact your health insurance administrator.
  • For people who are already on Medicare and then lose their job (or have another qualifying event) and become eligible for COBRA coverage, you are allowed to sign up for COBRA.  This right is part of ESRD, and in this situation Medicare will be the first plan to pay for any services and then COBRA will pay after that.  The reason to take COBRA in this situation would be due to high medical costs that Medicare doesn’t cover but your COBRA plan would.

Additionally it is important to understand that people who are eligible for Medicare (due to ERSD), have a 30 month coordination period when the employer’s group health insurance plan pays first and then Medicare pays second.  For people enrolled in COBRA during this 30 months window, COBRA health insurance will be the primary insurer.  When COBRA ends, which is likely to happen within that period, Medicare will then take over.  If your COBRA coverage does not end in the 30 months for some reason, then the positions will simply swap and Medicare will become the primary insurer.

Medical Insurance for Pre Medicare Spouses and Dependents

Posted on: August 20th, 2012 by Kristen Marie

nurse with clipboardRonald has just turned 65 and is planning to retire in the next month.  He will qualify for Medicare and is planning on enrolling.  However, Ronald’s wife is only 60 and has been using Ronald’s employer sponsored health insurance plan.  Additionally, Ronald’s 24 year old daughter, who is in graduate school, is also using the employer plan from Ronald’s work. What options does Ronald’s wife and daughter have to stay insured?

Unfortunately this situation is all too common since Medicare is only available to people over 65 unless there is a disability.  So what options do you have for health insurance? 

1.  COBRA Insurance:  The most common option that people in this situation will use is COBRA health insurance.  COBRA will allow both Ronald’s wife and daughter to stay on his former employer sponsored health insurance plan for up to 36 months since Medicare qualification is a qualifying event.  Additionally to qualify for COBRA the plan must cover at least twenty full time employees and still be active.  Under COBRA coverage the health insurance plan will remain exactly the same – same doctors, deductibles, co-payments, etc. which is a huge benefit for many.  However the main drawback is that COBRA can be very expensive since they will be responsible for paying the entire premium.

2.  Employer Retiree Benefits:  Some companies offer retiree benefits to their employees after retirement.  Many times one of these benefits is that spouses and children can extend their coverage for a predetermined length of time.  The cost and term length vary by employer so to find out if this is an option for you, you will have to inquire with your workplace.

3.  Keep Working:  Although not the favorite option, sometimes if possible it actually may be beneficial for Ronald to keep working to maintain health insurance.  This is usually only in cases where there are serious health conditions and finding insurance through another provider or COBRA isn’t going to work out.  In some cases where keeping insurance is absolutely necessary, continuing to work may be the best option.  For people in this situation, you may be able to cut back your hours and still qualify depending on your workplace.

4.  Buy a Private Policy:  The last option, and one of the most common, is to buy a private policy.  Private policies can offer all levels of coverage from comprehensive and minimal and usually are much more affordable than COBRA for people who are relatively healthy.  For people with preexisting conditions or major medical needs, they can consider PCIP plans and state high risk pools.

In any case, it is extremely important that Ronald and his family find some way to keep health insurance coverage.  Having any lapse in coverage can make it more difficult to qualify for new plans in the future and also can have dire consequences should a medical need arise.  Carefully weigh your options if you find yourself in this situation to make sure that you choose an option that works in both the short term and long term for your financial situation and health situation.

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