a small employer group(approx 20 employees) has an employee retiring on 12/31/00.
that employee is currently enrolled in the group health plan and elgible for medicare.
is the retiring employee eligible for COBRA programs since he is already eligible for medicare?

If the group is less than 20 employees, then the coverage continuation law of your particular state would apply. Assuming that there are 20+ employees and the federal Cobra law applies, then the employee will be allowed to be enrolled both in Medicare and the Cobra coverage as long as he or she was enrolled in Medicare before beginning Cobra coverage. If he enrolls in Medicare after starting Cobra coverage, then that event will terminate his Cobra coverage.