Is COBRA better than Medicare?Asked by: Miss Madge Schroeder III | Last update: February 11, 2022
Score: 4.3/5 (66 votes)
You should keep Medicare because it is responsible for paying the majority of your health care costs. COBRA is typically expensive, but it may be helpful if you have high medical expenses and your plan covers your Medicare cost-sharing or offers other needed benefits.
Can I use COBRA instead of Medicare?
If your Medicare benefits (Part A or Part B) become effective on or before the day you elect COBRA coverage, you can continue COBRA coverage as well as having Medicare. ... (But if COBRA covers your spouse and/or dependent children, their coverage may be extended for up to 36 months because you qualified for Medicare.)
Is it worth it to get COBRA insurance?
COBRA provides a good option for keeping your employer-sponsored health plan for a while after you leave your job, but the cost can be high. Make an informed choice by looking at all your options during the 60-day enrollment period, and don't focus on the premium alone.
Is COBRA more expensive than Medicare?
For most people, COBRA will be significantly more expensive than Medicare. In a few circumstances, though, this might not be the case.
Can I stay on COBRA when I turn 65?
Medicare Part A & B is insurance that is available to those 65 or older and those younger than 65 on Social Security Disability. ... You may be on COBRA after your employment ends, but once you are eligible for Medicare, you should enroll in Medicare A & B.
Got COBRA? Here's How Medicare and COBRA Work When You're 65+
Is COBRA considered creditable coverage for Medicare?
COBRA is not normally considered to be creditable coverage for Medicare major medical benefits, so people who are enrolled in COBRA and do not enroll in Medicare Part B within 8 months of turning 65 face substantial financial penalties for the rest of their lives, even if they have months or years left on their COBRA ...
Can I get COBRA when I retire?
Retirees can use COBRA Insurance For 18 Months
Retirement is a qualifying event. When a qualified beneficiary retires from their job, the retired worker is entitled for up to 18 months health insurance continuation, which is the maximum amount of time an employee can keep COBRA continuation.
Is COBRA cheaper than private health insurance?
Buying COBRA means consumers should expect to pay about twice as much as a private insurance plan. ... Under COBRA, the enrollee typically pays both the employer and employee portion of the health insurance premium plus an administrative fee of 2%. The amount for private or self-purchased plans is typically 50% less.
How much is COBRA monthly?
On Average, The Monthly COBRA Premium Cost Is $400 – 700 Per Person. Continuing on an employer's major medical health plan with COBRA is expensive. You are now responsible for the entire insurance premium, whereas your previous employer subsidized a portion of that as a work benefit.
Is it better to use COBRA or Obamacare?
So which one is better? Typically ACA insurance is more affordable than COBRA insurance because you can be eligible for federal ACA subsidies, depending on your income. COBRA costs an average of $599 per month.
Are COBRA payments tax deductible?
Premiums for COBRA insurance are tax deductible, as they are paid entirely by you on an after-tax basis. If you buy medical coverage through an insurance marketplace, then premiums would be tax deductible as a medical expense.
How long does COBRA benefits last?
Q11: How long does COBRA coverage last? COBRA requires that continuation coverage extend from the date of the qualifying event for a limited period of 18 or 36 months.
Why is COBRA coverage so expensive?
The cost of COBRA coverage is usually high because the newly unemployed individual pays the entire cost of the insurance (employers usually pay a significant portion of healthcare premiums for employees).
Why is COBRA not considered creditable coverage?
COBRA is NOT creditable coverage for Part B. If you delay enrollment, you'll face lifetime penalties. You could choose to have Medicare Part A and B, alongside COBRA. But COBRA isn't designed to work together with Medicare.
Can you have COBRA and another insurance at the same time?
You may not have COBRA continuation and another insurance at the same time. ... You may stay on COBRA as long as you do not obtain other insurance or become covered under your new employer's health insurance. The federal government's COBRA law allows workers to continue on the same plan they had when they working.
Can I go on Obamacare instead of COBRA?
No. Merely being offered COBRA doesn't affect your ability to qualify for an Obamacare subsidy. But to take advantage of the subsidy, you'll have to forgo your COBRA coverage and enroll in an Obamacare plan through the health insurance exchange during your 60-day special enrollment period.
Does COBRA include prescription coverage?
Yes, COBRA Covers Pharmacy Prescriptions, If You Had That Coverage Previously. ... The COBRA law allows you and your dependents to continue on the exact same coverage that you had with the employer's group health plan. Nothing changes in regards to your medication.
Can I get COBRA for one month?
Although COBRA is temporary, you'll have time to find another plan. Federal coverage lasts 18 months, starting when your previous benefits end. ... Each time you enroll, you're entitled to the same benefits for the same period of time.
Is COBRA better than Covered California?
Cobra is really expensive and you might not be able to change plans. Covered California can be priced much lower and you can change plans. If you qualify for a Covered Ca tax credit, it's hard to justify paying full premium for Cobra. Again, our services as Certified Covered California agents is free to you.
Is COBRA the best option?
COBRA in theory is a great option. Being able to continue your current insurance that you are familiar with can make work transitions easy. Unfortunately, because your former employer does not subsidize COBRA premiums, you will pay much more, up to 102% of the cost of the plan .
How do I find out how much COBRA will cost me?
- Your contribution: $125 per paycheck X 2 = $250 per month.
- Your employer's contribution: $400 per month.
- Total contribution: $250 + $400 = $650 per month.
- Service charge: $650 x 2% (or 0.02) = $13 per month.
- COBRA premium: $650 + $13 = $663 per month.
What benefits does COBRA cover?
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, ...
Can I use COBRA if I retire before 65?
COBRA lasts for 18 months after the employee has left the company and it can be extended in some cases. If retiring 18 months before becoming eligible for Medicare, this could be a great option for health insurance for an early retiree. COBRA allows you to keep your current insurance.
Is COBRA 18 months or 36 months?
When Federal COBRA ends, eligible employees can buy 18 months additional health coverage under Cal-COBRA. All qualified beneficiaries are generally eligible for continuation coverage for 36 months after the date the qualified beneficiary's benefits would otherwise have terminated.
Does Medicare coverage start the month you turn 65?
The date your coverage starts depends on which month you sign up during your Initial Enrollment Period. ... If you qualify for Premium-free Part A: Your Part A coverage starts the month you turn 65. (If your birthday is on the first of the month, coverage starts the month before you turn 65.)