Although an employee’s entitlement to Medicare will rarely be a COBRA qualifying event due to the MSP rules, it can extend the maximum COBRA coverage period for covered spouses and dependents if the employee has a termination or reduction in hours within 18 months after becoming entitled to Medicare. Under this rule, where the spouse or dependent is covered under the plan on the day before the employee's termination or reduction in hours, the spouse and dependent are entitled to COBRA continuation coverage for the longer of:
Full Answer
What happens to Cobra when you enroll in Medicare?
If your employees have Medicare first and then become eligible for COBRA, they may decide to keep both coverage types. This can be expensive, since they will have to pay for both, but they may find it to be worthwhile. If someone is enrolled in both COBRA and Medicare, Medicare is the primary insurance. In other words, Medicare pays first, and COBRA may pay some of the costs …
Do spouses and dependents qualify for Cobra if they have Medicare?
Apr 25, 2017 · Although an employee’s entitlement to Medicare will rarely be a COBRA qualifying event due to the MSP rules, it can extend the maximum COBRA coverage period for covered spouses and dependents if the employee has a termination or reduction in hours within 18 months after becoming entitled to Medicare. Under this rule, where the spouse or dependent is …
Can an employer require former employees to pay for Cobra?
entitlement to Medicare impacts eligibility under the Consolidated Omnibus Budget Reconciliation Act (COBRA). The following COBRA rules apply to Medicare beneficiaries: In most situations, group health plans are prohibited from terminating coverage due to an employee’s Medicare entitlement. The maximum COBRA period may be extended for spouses and
What is a Cobra plan?
Aug 23, 2018 · The Medicare entitlement of the individual can extend COBRA for the individual’s spouse and dependents for up to an additional 18 months (36 months in total) if the COBRA-qualifying event (termination of employment or a reduction of hours of the employee) occurs within 18 months after the individual became entitled to Medicare. Note, this would not apply …
Can my spouse go on COBRA If I go on Medicare?
Does COBRA cover family members?
Can a COBRA participant also have Medicare coverage?
What happens if I turn 65 while on COBRA?
Can you add dependents to COBRA?
What are the 7 COBRA qualifying events?
Is COBRA considered creditable coverage for Medicare Part B?
Is COBRA always secondary to Medicare?
Is Medicare entitlement A COBRA qualifying event?
Is COBRA considered creditable coverage for Medicare Part D?
What qualifies as a life changing event for Medicare?
What is COBRA Medicare?
COBRA Rules for Medicare Beneficiaries
As older Americans—those who are age 65 and older—continue to stay in the workforce, employers will need to understand how an employee’s entitlement to Medicare impacts eligibility under the Consolidated Omnibus Budget Reconciliation Act (COBRA). The following COBRA rules apply to Medicare beneficiaries:
COBRA Rules for Medicare Beneficiaries
An employer that is subject to COBRA must offer continuation coverage only when group health plan coverage ends (or would end) due to a qualifying event. If an employee or dependent loses group health plan coverage for a reason that is not a COBRA-qualifying event, the employer is not required to offer COBRA coverage.
Coordination of Benefits
Medicare’s coordination of benefits rules determine whether Medicare or another type of health coverage, such as COBRA coverage under an employer-sponsored group health plan, should pay first, or primary. A “primary payer” pays what it owes on benefit claims first, up to the limits of its coverage.
What is the number to call for Medicare?
If your group health plan coverage was from a state or local government employer, call the Centers for Medicare & Medicaid Services (CMS) at 1-877-267-2323 extension 61565. If your coverage was with the federal government, visit the Office of Personnel Management.
How long do you have to sign up for Part B?
If you’re eligible for Medicare, you don’t qualify for COBRA coverage without having to pay a premium. You have 8 months to sign up for Part B without a penalty, whether or not you choose COBRA.
What is a Part B late enrollment penalty?
In general, a health plan offered by an employer or employee organization that provides health coverage to employees and their families. This is called "continuation coverage.".
What is Cobra insurance?
COBRA is a federal law that may let you keep your employer. group health plan. In general, a health plan offered by an employer or employee organization that provides health coverage to employees and their families. This is called "continuation coverage.". coverage for a limited time after your employment ends or you lose coverage as a dependent ...
What is group health plan?
group health plan. In general, a health plan offered by an employer or employee organization that provides health coverage to employees and their families. This is called "continuation coverage.". coverage for a limited time after your employment ends or you lose coverage as a dependent of the covered employee.
What is a continuation plan?
In general, a health plan offered by an employer or employee organization that provides health coverage to employees and their families. This is called "continuation coverage.". coverage for a limited time after your employment ends or you lose coverage as a dependent of the covered employee.
How many employees can you have with Cobra?
In general, COBRA only applies to employers with 20 or more employees. However, some states require insurers covering employers with fewer than 20 employees to let you keep your coverage for a limited time.
Can COBRA be affected by Medicare?
As you can see above, COBRA can be affected by entitlement to Medicare and the interactions can be confusing – that starts with the terminology around Medicare “entitlement.”. The question arises most often around an individual’s 65 th birthday.
What is Medicare eligibility?
The COBRA regulations repeat the definition of the Medicare regulations. The Medicare regulations state eligibility for Medicare is the time when an individual meets all the requirements for entitlement to Medicare except application or enrollment in Medicare. Entitlement to Medicare, therefore, means all the requirements for Medicare have been ...
Is Medicare automatically enrolled at 65?
In practice, that means that someone who turns age 65 is not automatically entitled to (i.e., enrolled in) Medicare unless the individual is also receiving Social Security benefits. This has raised some confusion, as there can be an expectation that people are automatically enrolled in Medicare upon reaching age 65.
Can Medicare be terminated early?
Impact of Medicare entitlement on COBRA. Medicare entitlement can permit early termination of COBRA. The COBRA regulations permit plans to terminate COBRA before the normal time limit if the individual becomes entitled to (i.e., enrolls in) Medicare after electing COBRA.
Can an employer terminate Medicare?
However, if the employee is retired, it is permissible to terminate coverage under an employer plan based on Medicare entitlement. That would not be a COBRA-qualifying event for the retired employee, but it could be one for the spouse and dependents, which would trigger a 36-month COBRA period under the plan.
Can you terminate Medicare if you are retired?
However, if the employee is retired, it is permissible to terminate coverage under an employer plan based on Medicare entitlement. That would not be a COBRA-qualifying event for the retired employee, but it could be one for the spouse and dependents, which would trigger a 36-month COBRA period under the plan.
Can Medicare drive different time periods?
Conclusion. Enrollment in Medica re can drive different time periods under COBRA. Employers should be cognizant of the individual’s actual enrollment in Medicare when its group medical plans are administered to avoid unintended failures or extensions of coverage under their plans.
What is the cobra?
The Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) amended the Public Health Service Act, the Internal Revenue Code and the Employee Retirement Income Security Act (ERISA) to require employers with 20 or more employees to provide temporary continuation of group health coverage in certain situations where it would otherwise be terminated.
What is the COBRA requirement?
Title XXII of the Public Health Service (PHS) Act, 42 U.S.C. §§ 300bb-1 through 300bb-8, applies COBRA requirements to group health plans that are sponsored by state or local government employers. It is sometimes referred to as “public sector” COBRA to distinguish it from the ERISA and Internal Revenue Code requirements ...
Who has jurisdiction over Cobra?
The U.S. Department of Health and Human Services, through the Centers for Medicare & Medicaid Services (CMS) has jurisdiction with respect to the COBRA continuation coverage requirements of the PHS Act that apply to state and local government employers, including counties, municipalities and public school districts, and the group health plans that they sponsor.
Who is a qualified beneficiary?
A qualified beneficiary is an individual who is entitled to COBRA continuation coverage because he or she was covered by a group health plan on the day before a “qualifying event.” Depending on the circumstances, the following individuals may be qualified beneficiaries: a "covered employee" (a term that includes active employees, terminated employees and retirees); a covered employee's spouse and dependent children; any child born to or placed for adoption with a covered employee during the period of COBRA coverage; agents; self-employed individuals; independent contractors and their employees; directors of the employer; and, for public sector group health plans, political appointees and elected officials.
What is a qualifying event?
Qualifying events are certain events that would cause an individual to lose health coverage under a group health plan. The type of qualifying event will determine who the qualified beneficiaries are and how long they will be entitled to COBRA coverage.
How long does Cobra last?
In that case, COBRA lasts for eighteen months. If the qualifying event is the death of the covered employee, divorce or legal separation of the covered employee from the covered employee’s spouse, or the covered employee becoming entitled to Medicare, COBRA for the spouse or dependent child lasts for 36 months.
How long does a spouse have to be on Cobra?
If the qualifying event is the death of the covered employee, divorce or legal separation of the covered employee from the covered employee’s spouse, or the covered employee becoming entitled to Medicare, COBRA for the spouse or dependent child lasts for 36 months.
Do you have to notify Cobra that you are no longer eligible for the subsidy?
You must notify the health plan that's been providing your COBRA coverage that you're no longer eligible for the subsidy. This notification must be made in writing. Once you become eligible for other group health coverage or Medicare, you're no longer eligible for the COBRA premium subsidy, regardless of whether you actually enroll in ...
Can you get Cobra if you have other health insurance?
Once you become eligible for other group health coverage or Medicare, you're no longer eligible for the COBRA premium subsidy, regardless of whether you actually enroll in the other group health coverage or Medicare.
Can you still get Cobra if you have Medicare?
Once you become eligible for other group health coverage or Medicare, you're no longer eligible for the COBRA premium subsidy, regardless of whether you actually enroll in the other group health coverage or Medicare. Once eligibility for the subsidy ends, if you continue to receive COBRA coverage, you must pay the full COBRA premium without ...
How to report COBRA penalty?
Anyone who failed to notify their plan that they are no longer eligible for the COBRA subsidy should self-report that they are subject to the penalty by calling the IRS toll-free customer help line at 1-800-829-1040.
Is premium subsidy included in income?
A4. The premium subsidy is not included in the individual’s income. However, there is a phase-out of eligibility for the subsidy, which will increase some high-income individuals’ tax liability if they receive the subsidy. The phase-out impacts individuals whose modified adjusted gross income exceeds $125,000, or $250,000 for those filing joint returns. Tax liability is increased, to achieve repayment of a portion of the subsidy, for those taxpayers whose modified adjusted gross income is between $125,000 and $145,000, or $250,000 and $290,000 for those filing joint returns. If a taxpayer’s modified adjusted gross income exceeds $145,000, or $290,000 for those filing joint returns, the full amount of the subsidy must be repaid as an additional tax. There is no additional tax for individuals with modified adjusted gross income less than these income levels. (02/26/09)
What is a qualifying event?
The type of qualifying event determines who the qualified beneficiaries are and the period of time that a plan must offer continuation coverage. COBRA establishes only the minimum requirements for continuation coverage. A plan may always choose to provide longer periods of continuation coverage and/or to contribute toward the cost.
Who is a qualified beneficiary?
qualified beneficiary is an employee who was covered by a group health plan on the day before a qualifying event occurred or that employee’s spouse, former spouse, or dependent child. Only certain individuals can become qualified beneficiaries due to a qualifying event, and the type of qualifying event determines who can become a qualified beneficiary when it happens. A qualified beneficiary must be a covered employee, the employee’s spouse or former spouse, or the employee’s dependent child. In certain cases involving employer bankruptcy, a retired employee and their spouse, former spouse, or dependent children may be qualified beneficiaries. In addition, any child born to or placed for adoption with a covered employee during a period of continuation coverage is automatically considered a qualified beneficiary. An employer’s agents, independent contractors, and directors who participate in the group health plan may also be qualified beneficiaries.
What is COBRA group health plan?
Under COBRA, group health plans must provide covered employees and their families with specific notices explaining their COBRA rights. Plans must also have procedures for how COBRA continuation coverage is offered, how qualified beneficiaries may elect continuation coverage, and when it can be terminated.
How long does it take to get a Cobra election notice?
After receiving a notice of a qualifying event, the plan must provide the qualified beneficiaries with an election notice within 14 days. The election notice describes their rights to continuation coverage and how to make an election. The notice should contain all of the information you will need to understand continuation coverage and make an informed decision whether or not to elect it. The notice also should provide the name of the plan’s COBRA administrator and tell you how to get more information.
How long do you have to choose if you want to get Cobra?
Your plan must give you at least 60 days to choose whether or not to elect COBRA coverage, beginning from the date the election notice is provided or the date you would otherwise lose coverage under your group health plan due to the qualifying event, whichever is later.
What is continuation coverage?
The continuation coverage must be identi cal to the coverage currently available under the plan to similarly situated active employees and their families. (Generally, this is the same coverage that you had immediately before the qualifying event.) You must receive the same benefits, choices, and services that a similarly situated participant or beneficiary currently receives under the plan, such as the right during an open enrollment season to choose among available coverage options. You are also subject to the same rules and limits that would apply to a similarly situated participant or beneficiary, such as co-payment requirements, deductibles, and coverage limits. The plan’s rules for filing benefit claims and appealing any claims denials also apply.
Who administers Cobra?
COBRA continuation coverage laws are administered by several agencies. The Departments of Labor and the Treasury have jurisdiction over private-sector group health plans. The Department of Health and Human Services administers the continuation coverage law as it applies to state and local government health plans.
What is the law for cobra?
The law generally applies to all group health plans maintained by private-sector employers with 20 or more employees, or by state or local governments. The law does not apply to plans sponsored by the Federal Government or by churches and certain church-related organizations. In addition, many states have laws similar to COBRA, including those that apply to health insurers of employers with less than 20 employees (sometimes called mini-COBRA). Check with your state insurance commissioner's office to see if such coverage is available to you.
Can you terminate Cobra coverage early?
Keep in mind if you choose to terminate your COBRA continuation coverage early with no special enrollment opportunity at that time, you generally will have to wait to enroll in other coverage until the next open enrollment period for the new group health plan or the Marketplace.
How long do you have to elect Cobra?
If you are entitled to elect COBRA coverage, you must be given an election period of at least 60 days (starting on the later of the date you are furnished the election notice or the date you would lose coverage) to choose whether or not to elect continuation coverage.
Can you extend your 18 month coverage?
If you are entitled to an 18 month maximum period of continuation coverage, you may become eligible for an extension of the maximum time period in two circumstances. The first is when a qualified beneficiary is disabled; the second is when a second qualifying event occurs.
How long can a spouse continue Cobra?
A covered employee's spouse who would lose coverage due to a divorce may elect continuation coverage under the plan for a maximum of 36 months. A qualified beneficiary must notify the plan administrator of a qualifying event within 60 days after divorce or legal separation. After being notified of a divorce, the plan administrator must give notice, generally within 14 days, to the qualified beneficiary of the right to elect COBRA continuation coverage.
What is FMLA coverage?
The Family and Medical Leave Act (FMLA) requires an employer to maintain coverage under any group health plan for an employee on FMLA leave under the same conditions coverage would have been provided if the employee had continued working. Coverage provided under the FMLA is not COBRA coverage, and taking FMLA leave is not a qualifying event under COBRA. A COBRA qualifying event may occur, however, when an employer's obligation to maintain health benefits under FMLA ceases, such as when an employee taking FMLA leave decides not to return to work and notifies an employer of his or her intent not to return to work. Further information on the FMLA is available on the Website of the U. S. Department of Labor's Wage and Hour Division at dol.gov/whd or by calling toll-free 1-866-487-9243.
Is COBRA covered by federal employees?
Federal employees are covered by a law similar to COBRA. Those employees should contact the personnel office serving their agency for more information on temporary extensions of health benefits.
Why did the Department of Labor add Cobra?
Image Caption. The U.S. Department of Labor (DOL) has added language to COBRA model notices to inform retirees of the financial risks of postponing enrollment in Medicare because they've elected to receive employer-sponsored coverage under COBRA. The DOL issued the revised COBRA model notices on May 1, along with new COBRA Frequently Asked ...
Why did the Department of Labor add language to Cobra model notices?
Department of Labor (DOL) has added language to COBRA model notices to inform retirees of the financial risks of postponing enrollment in Medicare because they've elected to receive employer-sponsored coverage under COBRA.