6 Replies Latest reply on Feb 11, 2010 4:00 PM by katydoes

    COBRA

    katydoes
      I am wondering if anyone else has run up against the COBRA exception for the "equivalent insurance" rule. I turned 65 last April but did not apply for Medicare as I was covered under COBRA at my old employer and would be fully covered by my new employer as of June 1. When I applied for Social Security for when I turn 66 this year, the SS office informed me that because I did not have equivalent group insurance when I turned 65 I would have to pay the penalty rate forever. I have since done some research and have learned that, indeed, COBRA is not considered "equivalent insurance" even though it is exactly the same insurance I had when employed except that now I was paying the employer's share. I am thinking that insurance companies and/or business interests pushed this through as the price for their not opposing the COBRA law. It is appalling to me that I now am told that I will pay the penalty rate forever because of 33 days of COBRA insurance when I turned 65! Now that more people are working longer and/or changing jobs at retirement age, I would think that more and more people are going to get caught in this. Neither my previous employer nor my new one ever suggested to me that there might be a problem with Medicare even though I raised the question with both. I realize now that I should have spoken to a real person at SS rather than relying on their confusing (to me, anyway) website or the human relations departments of my employers. Lesson learned. Judging from the Internet discussions I saw, I am not the first person to fall into this trap. Somehow "forever" seems grossly unfair when I was actually saving the taxpayers (myself included) money!
        • Re: COBRA
          bluesman
          This sounds like the story of my life. Always hearing about the REAL thing after going through it. That's what happened to me on my first retirement. Something similar happened to me then... when I retired the 1st time, all I needed to do was work 30 more days and I would qualify for 600 more dollars a month on my retirement check. Think anyone was going to tell me that? Not human resources, that's for sure... but the funny thing about it was there were other people that were retiring around me that knew I should do this and did not tell me. Some friends huh... Live and learn
            • Re: COBRA
              katydoes
              As you say, live and learn. And I sure hate that feeling of being stupid. You probably noticed that people are merciless to you when you screw up like this!!! I didn't apply for Medicare because I didn't need it. My new job was going to give me full insurance (I even asked if I should apply for Medicare - to kinda give them a break in case I get sick) and was told - no, our insurance is better and you won't have to go through two insurance companies! You can apply when you're ready to retire. I just got a Medicare Part A card backdated to July 2009. Have no idea what that means!
                • Re: COBRA
                  bluesman
                  Well... good luck... I'll be praying for you.
                    • Re: COBRA
                      katydoes

                      I do thank you. It can't hurt! And now I get to leave the office and go home - there are times I ask myself why when so many of my friends are enjoying, if not shuffleboard, then a whole lot more leisure time than I have right now. But life is good so what's to complain about?

                      Have a wonderful evening - if it's evening where you are! Thanks for the sympathy!

                • Re: COBRA
                  Sharon

                  I thought Medicare was the same for everyone who turns 65 regardless of job status. Am I wrong?

                  My husband will be 65 in Sept. and is also on COBRA until then. I have no insurance and won't be 65 for another year.

                  Does this mean we are penalized for being part of the "downsizing" in the economy and on unemployment?

                  I am "retired" not by choice. Doing sub. teaching in public school means I get no retirement from them since they don't do social security, and my private school was TGIF funding and social security.

                  Where do we get answers?

                  Thanks!

                    • Re: COBRA
                      katydoes
                      Just make sure your husband signs up for Medicare before he turns 65 as COBRA is not considered "equivalent insurance." Apparently, you don't get penalized for not signing up for Medicare when you turn 65 if you have what is considered "equivalent insurance." Employers often will send you a letter in the months before you turn 65 to use as proof of "equivalent insurance" for people who continue to work past traditional retirement age. What I got trapped by was that COBRA benefits are not considered "equivalent insurance" even though you may have exactly the same insurance as when you were working. I suspect that this was a sop to insurance companies and business interests to win their support for COBRA legislation since it doesn't really make a whole lot of sense otherwise! I recommend visiting the AARP website for explanations on Medicare; the official Medicare site is not the easiest to understand. Also, your Congressman or Senator may have a Medicare specialist on staff. The important thing, though, is to make sure your husband signs up before his 65th birthday.