The Critical 8-Month Rule
This is the most important thing to understand: You have just 8 months from when your employer coverage ends to enroll in Medicare Part B without penalty. The clock starts when your employment ends—not when your COBRA coverage expires. Even if you elect COBRA to extend your coverage, you must still enroll in Medicare within 8 months of losing your job.
COBRA Coverage Basics
COBRA allows you to keep your employer group health plan coverage for a limited time after employment ends (generally 18 months, sometimes 36 months). However, COBRA only applies to employers with 20+ employees. Some states have “mini-COBRA” laws for smaller employers.
The Medicare-COBRA Problem
Here’s the critical issue: COBRA is generally NOT considered creditable coverage for Medicare. If you’re 65 or older and enrolled in COBRA, you still must sign up for Medicare Part A and B, or face substantial lifetime penalties.
Late Enrollment Penalties
If you miss the 8-month window:
- Part B penalty: An extra 10% added to your monthly Part B premium for each year you delayed enrollment—for the rest of your life
- Part D penalty: An extra 1% added to your monthly Part D premium for each month you delayed enrollment—for the rest of your life
These penalties are permanent and never go away.
2026 Medicare Costs
- Part B premium: $202.90/month (standard rate; higher if your income is above certain thresholds)
- Part A premium: Up to $518/month (if you have fewer than 30 quarters of coverage)
- Part A deductible: $283/year
Key Things to Know
- You must enroll in both Part A and Part B at 65, even if you have COBRA
- Medicare becomes your primary insurance, COBRA becomes secondary
- Don’t assume COBRA counts as creditable coverage—it usually doesn’t
- Mark your calendar for the 8-month deadline after your coverage ends
- Apply during your Initial Enrollment Period (3 months before your 65th birthday through 3 months after)
If you’re on COBRA and turning 65 or over, don’t wait—enroll in Medicare immediately. The lifetime penalties for missing the deadline are substantial.
We have helped many people over 26 years with these crucial decisions. This past year, we have helped numerous people with their benefits who were penalized because they didn’t fully understand Medicare laws. We continue to strive to help people every day with excellent resources that ensure our clients are properly protected. We help people the right way.
