COBRA: 7 important facts

Avoid unexpected medical bills
If you have COBRA and you’re eligible for Medicare, COBRA may only pay a small portion of your medical costs, and you may have to pay most of the costs yourself. Contact your COBRA plan and ask what percent they pay. 

To avoid unexpected medical bills, you may need to sign up for Medicare right away. Contact your State Health Assistance Program (SHIP), or call 1-877-486-2048 for free, personalized help with this decision.

1. COBRA is a federal law that may let you keep your employer  group health plan  coverage for a limited time after your employment ends or you lose coverage as a dependent of the covered employee.  This is called "continuation coverage."

Avoid gaps in coverage & the Part B late enrollment penalty
If you have COBRA before signing up for Medicare, your COBRA will probably end once you sign up. You have 8 months to sign up for Part B without a penalty, whether or not you choose COBRA. If you miss this period, you'll have to wait until January 1 - March 31 to sign up, and your coverage will start July 1. This may cause a gap in your coverage, and you may have to pay a lifetime Part B late enrollment penalty.

2. 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.

3. In most situations that give you COBRA rights (other than a divorce), you should get a notice from your employer's benefits administrator or the group health plan. The notice will tell you your coverage is ending and offer you the right to elect COBRA continuation coverage.

4. COBRA coverage generally is offered for 18 months (36 months in some cases). Ask the employer's benefits administrator or group health plan about your COBRA rights if you find out your coverage has ended and you don't get a notice, or if you get divorced.

5. The employer must tell the plan administrator if you qualify for COBRA because the covered employee died, lost their job, or became entitled to Medicare. Once the plan administrator is notified, the plan must let you know you have the right to choose COBRA coverage.

6. You or the covered employee needs to tell the plan administrator if you qualify for COBRA because you got divorced or legally separated (court-issued separation decree) from the covered employee, or you were a dependent child or dependent adult child who's no longer a dependent. 

You'll need to tell the plan administrator about your change in situation within 60 days of the change. 

7. Before you elect COBRA, talk with your State Health Insurance Assistance Program (SHIP) about Part B and Medigap.

Get answers to COBRA questions 

Call your employer’s benefits administrator for questions about your specific COBRA options.

  • If you have questions about Medicare and COBRA, call the Benefits Coordination & Recovery Center (BCRC) at 1-855-798-2627 (TTY: 1-855-797-2627).
  • If your group health plan coverage was from a private employer (not a government employer), contact the Department of Labor
  • 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.