Does Enrollment in COBRA Protect You from Medicare Penalties?
“I retired from my employer of 20 years last June when I turned 66. I enrolled in COBRA, starting on July 1, instead of enrolling in Medicare because I was told that COBRA would protect me from Medicare penalties for 18 months. However, my sister pointed out something in the Medicare & You Handbook about Medicare’s Special Enrollment Period (SEP). It mentioned an 8-month window to enroll in Medicare Parts A and/or B after leaving your employer-provided health benefits. Now, I’m worried I may have missed my window to enroll in Medicare without penalty—or worse, that I won’t be able to enroll at all. I’m a regular reader of your Medicare column, and now I need “Ms. Medicare” to guide me. Please explain what I should do to enroll in Medicare correctly. Looking forward to your advice. – Robert
Your situation is not uncommon but does require quick action. You fall into Medicare’s 8-month Special Enrollment Period (SEP) for individuals losing employer-provided health coverage. However, your time is running out! Your SEP began on July 1 and will end on February 28.
The 2025 Medicare & You Handbook (page 17) clarifies that there is no 18-month window for penalty-free enrollment in Medicare Part B if you are covered under COBRA. Waiting beyond the 8-month SEP will either result in penalties or force you to delay enrollment until the Medicare General Enrollment Period (GEP), which happens only once a year from January 1 to March 31.
Fortunately, you have two options right now for enrolling in Medicare:
Option 1 – Enroll During the SEP to Avoid Penalties
To enroll penalty-free within your SEP, it’s important to act fast. Here’s what you need to do before February 28:
- Download the forms from SSA.gov/forms:
- CMS-L564 (“Request for Employment Information”)
- CMS-40B (“Application for Enrollment in Medicare Part B”)
- Get the CMS-L564 form signed by your former employer. Contact the Human Resources department at your previous workplace and ask them to complete and sign this form.
- Complete the CMS-40B form. Under section #9 (“Remarks”), write that you wish to start Medicare Part B coverage on March 1.
- Submit the forms to your local Social Security office. Either take the forms in person or send them via email. Inform the Social Security representative that your SEP is closing, and your Part B enrollment needs to be processed immediately.
This option ensures you avoid late-enrollment penalties, and your Medicare Part B starts on March 1.
Option 2 – Enroll During the GEP (With a Penalty)
If you miss the February 28 SEP deadline, you can still enroll in Medicare during the General Enrollment Period (GEP). However, this will include a late-enrollment penalty.
- GEP Dates: January 1–March 31 annually.
- Coverage Start Date: If you enroll during the GEP, your Medicare Part B coverage will begin on April 1.
- Penalty: You will face a late-enrollment penalty, which is calculated based on how long you went without enrollment after becoming eligible at age 65.
Ignoring this window completely would further delay your enrollment until the next GEP in 2026, increasing the penalties you’ll owe.
Whenever you’re leaving an employer or losing company health benefits, you should have Medicare Part B in place. Delaying enrollment means penalties that can stack up over time. The penalty is calculated from when you turned 65 or when you first became eligible for Part A.
For personalized assistance, feel free to call the Toni Says Medicare Call Center at 832-519-8664 or email [email protected].
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Originally published February 12, 2025
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