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How to Prevent a COBRA Nightmare!

Dear Toni:
I lost my job July 2016 and my wife and I are now enrolling in Medicare Part B since COBRA’s almost over. Now I am finding out that there will be a penalty for us not enrolling when we should have. I have never received a Medicare & You handbook to know how or when to enroll in Medicare properly. Didn’t know I was unaware of the rules until I began reading your column in the local newspaper.
We are now 70 years old and the Part B penalty for us is each 50 percent, because it is 5 years since we were 65. Please inform your readers how important it is to enroll at the correct time.
from Katy, Texas

Hello, Robert:
You are right that people should not wait to enroll in Medicare Part B when no long working full-time with true company benefits. As you very well know, these penalties can be extremely costly, and that penalty will last until you pass away or are no longer on Medicare.
Social Security keeps track of your employment record when you are past 65 and have delayed your Part B. You must get your company Human Resource department to sign off on Social Security form “Request for Employment Information” to verify that you have been covered by employer benefits since turning 65. If your company does not sign off on the form, you can receive a 10 percent penalty for every 12-month period that you could have been on Medicare Part B, but failed to enroll.
IMPORTANT: Always be sure that your Part B begins the day you lose your company benefits or the day your COBRA plan starts. Chapter 1 of the new Medicare Survival Guide Advanced edition discuses the rules of enrolling in Medicare the right way with a sub-chapter discussing enrolling in COBRA.
Many enroll in their Part B with a BIG SURPRISE like you have, Robert. They find that they are penalized because they could have had Part B, but didn’t enroll. The penalty goes all the way back to the day they turned 65 or the day Part A began.
I have a client in Wharton, Texas, 79 years old, who has always been on his wife’s company health plan. He never enrolled in Medicare’s Part B because his wife was the “working spouse.” But she lost her job. She was 62 years old, and because she had health issues and the cost of COBRA was less than an individual Obamacare health plan, she enrolled herself and her 79-year-old husband in COBRA. When COBRA ended 18 months later, they went to Social Security to enroll him in Part B and were shocked! His premium for Part B was not $134. It was $134 plus $187.60 penalty for late enrollment for a total of $321.60 per month. This was a 140 percent penalty (79-65), which is 14 years x 10 percent each month for the rest of his Medicare life. You say, “Toni, how can this be?” And here is the answer is: “He did not enroll in “Part B” at the right time or the correct way!
My advice is always to have Part B in place when leaving your job or losing your company benefits because the penalty goes back to the day you turn 65.
Toni Says® Always have Part B in place when leaving your job or losing your company benefits. There might not be a second chance!

Toni King, author of the new Medicare Survival Guide® Advanced edition, is giving a “Merry Christmas $5 discount gift” for a Toni Says package which includes a book, DVD and workbook bundle, available only at Call 832/519-8664 to have your Medicare questions answered.