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Is COBRA Creditable Coverage for Medicare

If you’re on COBRA through you or your spouse’s current or previous employer and are eligible for Medicare, you probably have questions about the future of your coverage. We’re here to explain how these coverages work together and answer the most frequently asked questions about this topic.

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Medicare and COBRA

The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) helps employees extend health care benefits at least 18 months after they cease to be eligible. Qualifying events for COBRA include termination of employment or reduction in working hours.

It is possible to have COBRA and Medicare coverage at the same time. However, it can become confusing if you do not have accurate information.

Medicare and COBRA do not coordinate the same as employer coverage and Medicare. When you have COBRA, Medicare usually pays first, and COBRA pays second.

However, your group insurance may have special rules determining the primary payer. Refer to your COBRA plan document for details regarding your plan.

If a COBRA beneficiary becomes entitled to Medicare during their COBRA continuation period, coverage is terminated unless otherwise stated by their policy details.

If your coverage ends and your spouse or children are covered under the plan, their coverage will generally continue until the 18th month. It is important to know the terms of your COBRA policy to know if your plan will continue once eligible for Medicare.

If you decide to enroll in Part B while you are working and keep your group coverage, you can have Medicare and COBRA at the same time when you retire.

Does COBRA Count as Creditable Coverage for Medicare?

To avoid penalties with Medicare, you must have creditable coverage. This means coverage that’s at least equivalent to Medicare. COBRA does NOT meet these standards.

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If you’re Medicare-eligible and have COBRA, you should enroll in Medicare Part B. Delaying your Part B while on COBRA could result in penalties.

Because COBRA only extends group benefits for up to 18 months, it’s rare for it to be a Medicare-eligible person’s best option for health care coverage. Often, Medicare will offer more benefits at a lower cost.

Do I Need Medicare Part B if I Have COBRA?

If you’re working past 65 and retire later, you MUST enroll in Part B within the first eight months you have COBRA even if your COBRA stays active longer than eight months. This is because COBRA is not credible coverage for Part B.

Those who miss this timeframe will incur a Part B late penalty. If you’re on COBRA and under 65, you must enroll in Part A and Part B during your Initial Enrollment Period.

Your Initial Enrollment Period will begin three months before your 65th birthday. Yet, you will incur penalties if you don’t enroll during the seven-month window.

Can You Get COBRA if You Retire Early?

You can get COBRA if you retire early, but it’s usually costly. With COBRA, you are responsible for your premium, your employer’s contribution, and any extra amount owed to the carrier.

We recommend looking into alternative health care options before choosing COBRA. Often, Marketplace plans are more cost-efficient than COBRA if a beneficiary is under 65.


Is COBRA considered creditable Part D coverage?
Typically, COBRA is not creditable drug coverage for Part D. However, if your plan is an exception, you’ll have a Special Enrollment Period to join a Part D plan without a penalty. Refer to your plan administrator to confirm the creditability of your current drug coverage.
Is COBRA creditable coverage for Medicare Part B?
COBRA is NOT creditable coverage for Part B. If you delay enrollment, you’ll face lifetime penalties. You could choose to have Medicare Part A and B, alongside COBRA. But COBRA isn’t designed to work together with Medicare.
Does losing COBRA qualify you for a Special Enrollment Period?
You can qualify for a Special Enrollment Period if you lose health coverage through your employer when you’re Medicare-eligible. If you have COBRA when coverage ends, you won’t qualify for a Special Enrollment Period through Medicare.
Who pays first, COBRA or Medicare?
Medicare pays first, except when you have End-Stage Renal Disease. If you have End-Stage Renal Disease, then COBRA pays first. Medicare pays second to the extent COBRA coverage overlaps during the first 30 months of Medicare eligibility.

How to Get Help with Medicare and COBRA

We know Medicare is a beast constantly unleashing new information. Luckily, you don’t have to face this confusion alone. Our team of Medicare experts is ready to answer any additional questions you have. Give us a call at the number above to get your quote today, or fill out an online rate form to shop policies available in your area.

David Haass

David Haass

David Haass is the Chief Technology Officer and Co-Founder of Elite Insurance Partners and MedicareFAQ.com. He is a member and regular contributor to Forbes Finance Council and stay up-to-date with the latest Medicare trends and changes. He holds a Bachelor of Science in Business Administration and Management from the University of Florida.
Ashlee Zareczny

Ashlee Zareczny

Compliance Manager
Ashlee Zareczny is the Compliance Manager for MedicareFAQ. As a licensed Medicare agent in all 50 states, she is dedicated to educating those eligible for Medicare by providing the necessary resources and tools. Additionally, Ashlee trains new and tenured Medicare agents on CMS compliance guidelines. Ashlee is a Medicare expert who specializes in Medicare Supplement, Medicare Advantage, and Medicare Part D education.

4 thoughts on "Is COBRA Creditable Coverage for Medicare"

  1. My wife is on disability based on stage four ovarian cancer she is 63. I’m 64 and retiring on 12/31/21 I’m going on cobra for 18 months she was going on cobra with me. We don’t want to apply for part B Medicare or part D Medicare which is for meds. Her med presently is about 17,000 a month and is being paid fully by my present employers plan with BCBSM and a coupon from the manufacturer. We don’t want to and can not afford to lose this. What options do we have?
    We want to use Cobra and not apply to part B or part D of Medicare

    1. Dan, once you retire, you can keep COBRA coverage until you turn 65. Once you turn 65, COBRA no longer becomes creditable for Medicare. At this point, you are not required to enroll in Medicare, but it is recommended to avoid penalties in the future and avoid a lapse of coverage. To help save money on prescription drug costs, you can apply for Extra Help or Medicare Savings Programs to offset out-of-pocket costs.

  2. My husband and I are retiring in June and going on Medicare. My 21 year old son is still in college and his school does not offer medical insurance for a fee. What are our options. Thank you


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