Cobra Health Insurance: What You Ought To Know

You should understand that by law you are still entitled to continue your group health coverage if you lost your job for any reason. It does not matter if you received a pink slip, resigned or have been cut down to part-time.

Rights are guaranteed under COBRA. COBRA is short for Consolidated Omnibus Budget Reconciliation Act of 1986, is an amendment of the Employee Retirement Security Act. COBRA offers shelter when people’s group health plans are terminated.

In spite of why one may have lost their employment, with the exclusion of gross misconduct, they have the chance to maintain your employer’s group plan for up to 18 months if they meet the premiums. For up to three years, often the family is also eligible to keep COBRA coverage.

When you choose to maintain your plan under COBRA, you can be charged 100 percent of the payments plus a 2 percent administrative fee. The cost of COBRA is extremely expensive and most can not maintain the payments for it.

Most people that are eligible for COBRA consider buying individual health insurance or short-term health insurance to bridge the gap until they land a new job with health benefits. A business must have employed at least 20 employees minimally for 6 months that are enrolled in a group plan to meet the criteria for COBRA. Eligibility for COBRA is dependent on qualifying events.

These events include leaving a company and becoming unemployed or self-employed, being a widow or widower or child of an employee who died, divorced spouse or child of an employee who has left the company, or are the child of an employee and you have reached the plan’s cut-off age. The law grants an exemption from COBRA continuation rules to federal employees, certain church-related organizations and firms employing fewer than 20 people.

Employers must figure part-time workers into their employee total to determine if they can claim exemption, according to the IRS rules. Several states have passed “mini-COBRA” regulations that pertain to employers with 2 to 19 personnel.

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