COBRA and Medicare

Here’s one of the most expensive mistakes we see people make when they leave a job at or after 65: they take COBRA to keep their old health plan, assume it counts as coverage, and put off enrolling in Medicare Part B. It feels reasonable — you still have insurance, so why rush? But COBRA and Medicare don’t work the way people expect, and this specific move can lock in a permanent penalty and leave you with coverage gaps. This is part of our Working Past 65 guide, and it’s worth getting exactly right.

COBRA Doesn’t Let You Delay Part B

The single most important fact on this page: COBRA is not creditable coverage for delaying Medicare Part B. Coverage from a current, active job can let you postpone Part B without penalty (see Medicare and employer coverage and delaying Part B). COBRA is different — it’s the continuation of a plan after your active employment has ended, and Medicare does not treat it as a reason to delay.

So if you’re eligible for Medicare, you should enroll in Part B when your active employment ends — not rely on COBRA to carry you. For the rules on which coverage counts, see Medicare creditable coverage.

Your Window Starts When the Job Ends, Not When COBRA Ends

When active employer coverage ends, you get a Special Enrollment Period (SEP) to sign up for Part B — an 8-month window. The trap is when the clock starts:

• Your 8-month SEP starts when your active employment ends.
• It does NOT start when your COBRA ends.
• COBRA does not extend this window.

Because COBRA can run for many months, people naturally wait until it’s about to run out to think about Medicare — and by then the 8-month window has often already closed. They miss it and get penalized. Don’t count from your COBRA end date; count from the day your job (active employment) ended. More on this in our Special Enrollment Period guide.

Medicare Is Primary Over COBRA

Once you’re eligible for Medicare, Medicare is primary and COBRA pays secondary. That order matters. If you actually enroll in Medicare, it pays first and COBRA can fill in behind it. But if you skip Part B and lean on COBRA alone, you’re exposed: COBRA won’t fully pick up the share Medicare was supposed to pay as the primary payer, and you can be left with large bills the plan won’t cover. That’s the second half of the trap — not just the penalty, but real coverage gaps.

The Trap, in One Sentence

Taking COBRA at 65 and skipping Part B leads to (1) a permanent Part B late-enrollment penalty and (2) coverage gaps, because Medicare should have been primary all along. You can estimate what the penalty would cost with our Part B penalty calculator — the surcharge is added to your premium for as long as you have Part B, so it’s a lifetime cost, not a one-time fee.

Part D Is a Separate Question

Keep Part B and Part D straight. The rules above are about Part B (medical). For Part D (prescription drug coverage), COBRA can sometimes count as creditable coverage — so drug coverage through COBRA may protect you from the Part D late penalty even though it does nothing for Part B. Don’t let that lull you into thinking COBRA covers you for Part B; it’s two different rules, and only one of them can be satisfied by COBRA.

Get This Right — Free Help

If you’re on COBRA now, or you’re about to leave a job at or after 65, the timing of your Part B enrollment is the whole ballgame. Call us free at 435-219-5120 (TTY: 711) and we’ll pin down exactly when your window started, make sure you enroll in Part B on time, and keep you out of the penalty. See also our Working Past 65 hub and the guide to Medicare with employer coverage.