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Overview

Can I elect COBRA if I am already enrolled or will soon enroll in other group health coverage or Medicare? Whether you can elect/continue with COBRA depends on the specific timing and the order in which you become eligible under COBRA and Medicare. 

If Become Eligible BEFORE You Elect COBRA

If you are already enrolled on another employer group health plan or Medicare before you elect COBRA:

  • You are entitled to elect COBRA even if you have other group health plan coverage or are entitled to Medicare Part A or Part B benefits on or before the date on which COBRA is elected.

  • Note that having coverage provided by more than one plan (an employer-sponsored plan or Medicare) will affect which plan is the primary and secondary payer of medical claims. You are responsible for contacting your insurance company directly to confirm how coverage will work and which plan will be primary vs. secondary.

If Become Eligible AFTER You Elect COBRA

If you become enrolled on another employer group health plan or become entitled to Medicare Part A or Part B after you elect COBRA:

  • These events are disqualifying events for COBRA coverage

  • If you enroll on a new employer plan or your spouse’s employer plan, you are no longer eligible to continue COBRA coverage.

  • If you become entitled to Medicare Part A or Part B, you are no longer eligible to continue COBRA, except if your Medicare Entitlement is due to End Stage Renal Disease.

  • Even though the COBRA regulations do not allow you to continue both coverages, you are still responsible for notifying Vita COBRA in writing via mail, e-mail, or phone within 30 days of the coverage cancellation date. If not, any health claims incurred after the date coverage should have been canceled will still be retroactively declined. 

Important Note about Medicare Secondary Payor Rules

Medicare Secondary Payer (MSP) rules will apply if you are enrolled in, eligible to enroll, or if you waived enrolling in any part of Medicare while covered under COBRA. In other words, COBRA coverage will generally be the secondary payer of claim when you have COBRA coverage, even if that was not the case when you were an active employee or the dependent of an active employee. Insurance companies can (and do) treat COBRA as the secondary payer of COBRA claims (meaning they will typically only pay 20% of Medicare Allowed Charges) even if you are not actually enrolled in Medicare. When this occurs, the insurance company will pay as if Medicare paid, even though Medicare won’t actually pay if you aren’t enrolled. This could mean you will be responsible for what Medicare would have paid for your claims. You are responsible for checking with your health plan to determine which plan is the primary and secondary payer during your COBRA period. Medicare Part B coverage cannot be activated retroactively, so it is critical to make sure that you sign up for Medicare if your COBRA health plan will be a secondary payor. 

Keywords: COBRA, FSA, rollover, FSA premium, medicare
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