RSVP can take the guesswork out of COBRA, Medicare and

It should come as no surprise that in today’s world Baby Boomers keep moving their retirement horizon by continuing to work well into their 60s, 70s, and beyond. Some continue to work out of necessity in order to augment Social Security income or because they lack adequate savings to otherwise stay solvent. Even if money is not an issue, others happily continue to be employed to fill time, stay connected to colleagues and, perhaps, achieve a sense of satisfaction by contributing to society and the economy through their employment. Given that lifespans are increasing and the incidence of major diseases is decreasing, looming decades of retirement don’t seem particularly thrilling to many, especially to those without the resources and infrastructure to fully support years of leisure.

So, okay, you’re 65 or older and still actively employed and have been covered through your employer’s group health insurance. Perhaps your spouse or other dependents have also been covered under your employer’s group plan. Then it happens. You are informed that your job has been eliminated, and your Human Resource liaison hands you a packet of information to read that contains information about COBRA and sends you on your way.

COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that may allow you to continue to be covered under your employer’s health plan for a limited period of time, usually 18 months, and, in some cases, 36 months. In general, this applies to employers with 20 or more employees, although state laws may dictate otherwise. In order to continue health benefits under COBRA, you must actively elect to do so.

Here’s where it gets tricky if you are age 65 or older. You are eligible for Medicare. If you do elect COBRA, you need to do your homework and check with your employer’s health benefits administrator or the group health plan’s representative to determine how coverage under COBRA coordinates with Medicare. In the vast majority of cases -- even if you are not currently enrolled in Medicare Parts A and B -- but solely because you are “Medicare eligible,” Medicare will be your primary insurance, and the COBRA coverage will only pay as a secondary insurer — typically picking up the tab for a fraction of the costs for your medical care. Consequently, you may be paying a hefty monthly premium for your continued medical insurance under COBRA and not be receiving the full coverage you felt you were entitled to. The landscape changes, however, if you turn 65 after electing COBRA. In that situation, COBRA coverage would cease when you become eligible for Medicare.

If it’s determined that the group health plan pays secondary to Medicare, you should enroll in Medicare Part B (medical insurance) as quickly as possible, as well as Part A (hospital insurance), if you had not already done so.

Besides not being fully covered for your medical expenses under COBRA, another consequence of not enrolling in Medicare Part B is that you may be liable for a late enrollment penalty, should you miss the special eight-month enrollment window available to you due to your termination of employment. Note that the clock starts ticking from the date your active employment ends (not starting with the end of COBRA coverage). After that special enrollment period ends, you will have to await a General Enrollment period which runs January 1 through March 31 of each year, and you run the risk of the late enrollment penalty.

The upside is that once you are enrolled in Part A and Part B, you have a number of options open to you for obtaining medical and prescription drug coverage, usually for less cost than continuing the same coverage under COBRA.

In order to better understand the coordination of your benefits under COBRA and to explore your options for coverage under Medicare, you can speak with a state-trained APPRISE Medicare Counselor at RSVP (formerly RSVP of Montgomery County) to receive free unbiased information.

Since 1973, RSVP has been the region’s leading volunteer placement agency for adults. For more information or to make an appointment for this confidential counseling service, call an RSVP Counselor at 610.834.1040 ext. 20 or visit http://www.rsvpmc.org/content/apprise-medicarecounseling.