What is COBRA?
COBRA is an acronym for the Consolidated Omnibus Budget Reconciliation Act. It is a federal law that requires companies with 20+ employees to continue their group health insurance up to 18 months after they or their spouse leaves their job. Although your coverage will stay the same, you will see a large increase in your premium as you will pay 100% of coverage.
How does COBRA work with Medicare?
If you decide to stay on COBRA after you turn 65, COBRA will become secondary to Medicare. COBRA is not considered “creditable coverage” by Medicare. If you’re turning 65 and have COBRA coverage, you will need to join Medicare. Unfortunately, some people are led to believe they do not need Medicare and find themselves owing hefty hospital bills that Medicare Part A and Medicare Part B would have covered. In almost all circumstances, it doesn’t make sense for you to continue paying COBRA coverage as well as Medicare.
How do I cancel my COBRA coverage?
To cancel COBRA coverage when you’re ready to join Medicare, you will need to get in contact with your previous employer for instructions and or paperwork. In conclusion, COBRA is not meant to be your primary health coverage once you turn 65.
