It depends. If you lose your employer healthcare coverage (EGHP), you may be eligible for healthcare coverage through COBRA or the Consolidated Omnibus Budget Reconciliation Act of 1985. If your prescription drug coverage through your COBRA provider is considered "
creditable drug coverage" (drug coverage as good as standard Medicare Part D coverage), you will be granted a Special Enrollment Period (
SEP) to join a Medicare Part D plan as your COBRA coverage comes to an end.
Basically, the
SEP EGHP (Employer/Union Group Health Plan) allows the
Medicare beneficiary to enroll into a Medicare Part D plan or Medicare
Advantage plan when you are still enrolled in your employer plan or the
month the beneficiary is advised of the loss of creditable drug coverage
and
continues for two months from the loss of the coverage.
You will then be able to use the SEP to join a Part D drug plan when
your drug plan ends or up to 2 months after the COBRA coverage ends.
So you will need to speak with your COBRA administrator or COBRA provider to confirm that your drug coverage is "creditable" and then coordinate the ending of your COBRA coverage with the start (effective date) of your Medicare Part D coverage.
To learn more about your Medicare Part D options and for assistance joining a Medicare Part D drug plan, please telephone a Medicare representative at 1-800-Medicare (1-800-633-4227).
As reference, please see the Center for Medicare & Medicaid Services (CMS) Medicare & You Handbook:
"COBRA is a federal law that may allow you to temporarily
keep employer or union health coverage after the employment ends or
after you lose coverage as a dependent of the covered employee. . . . .
[i]f you take COBRA and [the COBRA coverage] includes creditable
prescription drug coverage, you’ll have a Special Enrollment Period to get Medicare drug coverage (Part D) without paying a penalty when the COBRA coverage ends."
As reference to this specific Special Enrollment Period, the Medicare Part D Manual notes:
"An SEP exists for individuals making an enrollment request
into or out of an employer/union group-sponsored Part D plans, for
individuals disenrolling from a Part D plan to take
employer/union-sponsored coverage of any kind, and for individuals
disenrolling from employer/union-sponsored coverage (including COBRA coverage)
to enroll in a Part D plan. The SEP EGHP may be used when the EGHP
allows the individual to make changes to their plan choices, such as
during the employer’s or union’s “open season,” or at other times the
employer or union allows.
This SEP is available to individuals who have (or are enrolling in) an
employer or union plan and ends 2 months after the month the employer or
union coverage of any type ends.
The individual may choose the effective date of enrollment or
disenrollment, up to 3 months after the month in which the individual
completes an enrollment or disenrollment request. However, the
effective date may not be earlier than the first of the month following
the month in which the request was made. The effective date also may not
be earlier than the first day of the individual’s entitlement to
Medicare."
Bottom Line: You can confirm with your
former-employer or COBRA administrator that your EGHP or COBRA drug
coverage is creditable and that the effective (starting date) date of
the Medicare Part D plan will correspond with the end of your COBRA
benefits.
Sources include:
2022 Medicare & You Handbook
Medicare Prescription Drug Benefit Manual, Chapter 3 - Eligibility,
Enrollment and Disenrollment, Updated: August 19, 2011 (Revised:
November 16, 2011, August 7, 2012, August 30, 2013, August 30, 2014,
July 6, 2015, September 1, 2015, September 14, 2015, December 30,
2015,May 27, 2016, August 25, 2016, June 15, 2017, July 31, 2018 &
August 12, 2020)
https://www.medicare.gov/supplements-other-insurance/how-medicare-works-with-other-insurance/cobra-7-important-facts
COBRA Continuation Coverage Questions and Answers
https://www.cms.gov/CCIIO/Programs-and-Initiatives/Other-Insurance-Protections/cobra_qna