Cobra for the medicare eligible

[n3417511]

One of my members was offered cobra through his work after being laid off. His company was paying four months so he took advantage of cobra and delayed applying for Medicare. He then made some claims before his Medicare plan kicked in. The claims were denied stating since he was eligible for Medicare, cobra won’t cover his claims. Regardless if he applied for Medicare or not, cobra will not cover and he is out over 3k. After appealing and appealing, he lost the appeal. Most people don’t take cobra when they are eligible for Medicare but when it’s paid for by his employer as part of his package, he took it. As a Medicare broker, I did not advise him of this rule because I didn’t know it existed. Am I the only Medicare broker that didn’t know about this rule?

 

[NWSINS]

What state holds the master contract and who is the insurance company?

 

[n3417511]

It’s a self funded insurance plan from the hospital he worked at. This is Minnesota.

 

[DonP]

I’ve always read never delay medicare in place of cobra . I know cobra is not credible coverage as far as penalties go .Won’t they backdate his part A 6 months when he gets Medicare ? Although 3 k of bills being small seems like part B charges ,

 

[NWSINS]

Federal continuation coverage will end if you become eligible for Medicare. Minnesota continuation coverage will end if you become enrolled in Medicare.

If the employer had more than 20 employees, Federal rules apply.

 

[n3417511]

This is what is confusing. We as Medicare brokers know that they have 8 months to enroll in part B without a penalty once employer coverage ends However we are not told that if they elect their cobra and not apply for Medicare, there is no coverage. These rules contradict themselves He should have received a letter from HR stating as a Medicare eligible person, cobra is not an option for him. Instead, they enticed him to take it for four months due to them covering him. I think he has a case here. Appeal based on his HR department dropped the ball on informing him about this rule. He did have part A. He said they paid the amount they would have paid based on him being enrolled in part A and B. So they barely paid anything at all.

 

[n3417511]

I’m feeling guilty for not knowing this rule. I could have saved this person so much grief and money had I have known. This example is not in our AHIP training. lol It should be because this is a big one

 

[DonP]

This is a tricky one . What if he had met his max out of pocket when he was offered cobra and laid off ? Of course he would have wanted to keep his coverage till yr end . This example is why the agent is so important for medicare beneficiaries and a world without agents would be a disaster.

 

[n3417511]

He did meet it. That’s why he wanted to stay on it. Along with them paying four months premium for him. Poor guy! I’m bummed.

 

[steve3752]

I am not trying to be harsh, but their is no contradiction in the rules as to how long a person has to go onto B when they leave an er plan in my opinion.

COBRA is an issue unto itself and is not credible coverage. The rules on COBRA do not say there is the same grace period that applies when a person leaves an employer plan. Read anything on the topic and they say you have to go into Part B when you take COBRA. Nothing else is said. You have to take B.

Medicare has more than one trickly and not always logical rules. Whenever you have a topic that could land you in trouble if you are wrong, you should look it up to make sure you are right. You did not do that.

This was a very avoidable mistake. AHIP at fault? I do not think so. Why did you not look this up?

I am just wondering whether this should be reported to E& O.

Again, not trying to be a jerk here, but this was so avoidable.