Many people approaching retirement in New Hampshire assume that COBRA coverage gives them extra time before they need to enroll in Medicare. Some retirees believe that taking COBRA after leaving a job allows them to delay Medicare enrollment without consequences. Unfortunately, COBRA does not stop Medicare’s clock. If you are 65 or older and miss Medicare’s strict enrollment deadlines, you may face permanent late enrollment penalties, denied claims, and higher premiums for life — even if you had COBRA coverage the entire time.
At Woodpecker Insurance, we work with retirees across New Hampshire who are leaving employer coverage or navigating COBRA after age 65. Time and again, we see how misunderstandings around COBRA and Medicare penalties lead to unnecessary costs. Knowing the federal Medicare enrollment rules — and acting on them early — can make the difference between smooth coverage and lifelong penalties.
If you are 65 or older and your active employment ends, Medicare gives you just eight months to enroll in Part B without penalty. That clock starts the day your employer coverage ends, not when your COBRA coverage runs out. COBRA may continue your insurance, but Medicare does not count it as creditable coverage for delaying Part B enrollment. Missing this window can mean gaps in coverage and permanent penalties. Coverage begins the month after you sign up, which can still leave you uncovered if you wait too long.
We recently worked with a New Hampshire client who learned this lesson the hard way. After retiring at 65, they elected COBRA and stayed on it for the full 18 months, believing Medicare could wait until COBRA ended. During that time, they did not enroll in Medicare Part B, and their Special Enrollment Period expired. When they finally enrolled, Medicare applied a permanent late enrollment penalty. In their case, the penalty added just over $20 per month for every month they did not have Part B — 18 months’ worth — to their premium for life. What seemed like a small monthly increase quickly became a costly, lifelong consequence.
Many people are also surprised to learn that COBRA does not fully protect them once they are Medicare-eligible. After age 65, Medicare must be your primary coverage. COBRA becomes secondary, meaning it expects Medicare to pay first. If Medicare isn’t in place when it should be, COBRA may deny claims altogether. Some people only discover this after receiving large medical bills, when their enrollment window has already closed.
The good news is that avoiding these issues is straightforward when you know the rules. If you are over 65 and your employer coverage is ending, you should apply for Medicare Parts A and B as soon as your employment ends, even if you plan to take COBRA. Enrolling on time ensures Medicare is in place as your primary coverage and protects you from penalties and denied claims.
To enroll using your Special Enrollment Period, Social Security requires two forms. The CMS-L564 must be completed by your former employer to verify that you had qualifying group coverage. The CMS-40B is your application for Medicare Part B. Together, these forms allow Medicare to activate your coverage without penalty, as long as you are still within the eight-month window.
Medicare rules are federal, and a single misunderstanding can be expensive. At Woodpecker Insurance, we’re proud to help retirees throughout New Hampshire, from Manchester and Nashua to the Lakes Region, navigate Medicare with confidence. We walk with you through every step, making sure deadlines aren’t missed and coverage is set up correctly the first time.
If you are planning to retire, transitioning off employer coverage, or currently on COBRA after age 65, now is the time to make sure your Medicare strategy is solid. Don’t let an avoidable deadline cost you thousands. Reach out to Woodpecker Insurance today and let us help you stay perched safely on the right branch, with Medicare coverage done right from the start.