What is COBRA continuation health coverage?
The Consolidated Omnibus Budget Reconciliation Act (COBRA) health benefit provisions amend the Employee Retirement Income Security Act, the Internal Revenue Code and the Public Health Service Act to require group health plans to provide a temporary continuation of group health coverage that otherwise might be terminated.
What does COBRA do?
COBRA requires continuation coverage to be offered to covered employees, their spouses, former spouses, and dependent children when group health coverage would otherwise be lost due to certain specific events. COBRA continuation coverage is often more expensive than the amount that active employees are required to pay for group health coverage, since the employer usually pays part of the cost of employees’ coverage and all of that cost can be charged to individuals receiving continuation coverage.
What group health plans are subject to COBRA?
The law generally applies to all group health plans maintained by private-sector employers with 20 or more employees, or by state or local governments. The law does not apply to plans sponsored by the Federal Government or by churches and certain church-related organizations. In addition, many states have laws similar to COBRA, including those that apply to health insurers of employers with less than 20 employees (sometimes called mini-COBRA). Check with your state insurance commissioner’s office to see if such coverage is available to you.
How long does COBRA coverage last?
COBRA requires for continuation coverage to extend from the date of the qualifying event for a limited period of 18 to 36 months. The length of time depends on the type of qualifying event that gave rise to the COBRA rights. A plan, however, may provide longer periods of coverage beyond the maximum period required by law.
From the United States Department of Labor
- An Employer’s guide to group health continuation coverage under COBRA:
- DOL – Employer’s Guide to COBRA
- An Employee’s guide to health benefits under COBRA:
- DOL – Employee’s Guide to COBRA
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