Timing Question/COBRA and Medicare

[SukiSays]

I retired last year and will turn 65 in September of this year. I am currently covered under my wife's emp grp plan. Wife is 53 years of age and is retiring effective June 3 of this year so I guess I'll be losing coverage as of July 1st. Since I plan on enrolling in a Medicare Advantage plan with a Sept 1 effective date, how can I avoid paying big bucks for premiums for July and August when I will have no coverage? I understand that I'll be eligible for COBRA and will have 60 days from the date we receive the COBRA information from her employer to elect COBRA but I'm not required to pay the premium at the time I submit the COBRA election form and that if I have a medical need--let's say I fall and break my arm on July 4, I can pay my COBRA premium on July 5 and will have retroactive coverage? Also, I can submit my COBRA election form without paying the premium and if I have no medical issues during that time there would be no need to submit my premium payment and conversely, if i have a medical need I simply submit my premium and it will be covered by COBRA? Your thoughts or suggestions?

 

[unic.consulting]

I retired last year and will turn 65 in September of this year. I am currently covered under my wife's emp grp plan. Wife is 53 years of age and is retiring effective June 3 of this year so I guess I'll be losing coverage as of July 1st. Since I plan on enrolling in a Medicare Advantage plan with a Sept 1 effective date, how can I avoid paying big bucks for premiums for July and August when I will have no coverage? I understand that I'll be eligible for COBRA and will have 60 days from the date we receive the COBRA information from her employer to elect COBRA but I'm not required to pay the premium at the time I submit the COBRA election form and that if I have a medical need--let's say I fall and break my arm on July 4, I can pay my COBRA premium on July 5 and will have retroactive coverage? Also, I can submit my COBRA election form without paying the premium and if I have no medical issues during that time there would be no need to submit my premium payment and conversely, if i have a medical need I simply submit my premium and it will be covered by COBRA? Your thoughts or suggestions?

The main problem with this plan (other than the questionable ethics) is that many providers require proof of insurance before they will see you. If you don't have COBRA until after the fact, they may require you to pay out of pocket at the time of the visit.

 

[WCMason]

I retired last year and will turn 65 in September of this year. I am currently covered under my wife's emp grp plan. Wife is 53 years of age and is retiring effective June 3 of this year so I guess I'll be losing coverage as of July 1st. Since I plan on enrolling in a Medicare Advantage plan with a Sept 1 effective date, how can I avoid paying big bucks for premiums for July and August when I will have no coverage? I understand that I'll be eligible for COBRA and will have 60 days from the date we receive the COBRA information from her employer to elect COBRA but I'm not required to pay the premium at the time I submit the COBRA election form and that if I have a medical need--let's say I fall and break my arm on July 4, I can pay my COBRA premium on July 5 and will have retroactive coverage? Also, I can submit my COBRA election form without paying the premium and if I have no medical issues during that time there would be no need to submit my premium payment and conversely, if i have a medical need I simply submit my premium and it will be covered by COBRA? Your thoughts or suggestions?

At least a couple of my med supp clients tried this. Knew they had the 63 days and waited to make COBRA election due to Medicare eligibility within two months. One had no claims and just let election expire, saving two months COBRA premiums. The other did need medical care so made the COBRA payments and had uninterrupted coverage.

I have been asked this question before. I tell them I can't recommend the strategy but know those who have done it.

Electing but not paying could be trouble. If you pay the employer and they pay the carrier--not the norm, but I've seen it--the employer may pay your premium to the carrier and will likely come after you for it.

Best course is always to do the right thing and pay for what you're receiving.

 

[somarco]

COBRA premiums are normally paid to the carrier or COBRA administrator. Rarely, if ever, paid to the employer.

 

[WCMason]

COBRA premiums are normally paid to the carrier or COBRA administrator. Rarely, if ever, paid to the employer.

Hence the "not the norm, but I've seen it" qualifier. I've seen it exactly once.