Keeping Your Health Insurance: What You Need to Know About COBRA Coverage

Health insurance can be confusing, especially during life transitions! Losing your job or experiencing a change in employment status can leave you wondering about your health coverage. In this blog, we'll break down everything you need to know about COBRA, a program that allows you to continue your employer-sponsored health insurance after certain qualifying events.

What Is COBRA?

COBRA stands for the Consolidated Omnibus Budget Reconciliation Act. This federal law allows qualified individuals to continue health insurance coverage under their employer's group health plan following a qualifying event that would otherwise result in a loss of coverage. This temporary bridge helps you maintain you existing plan and doctors while you explore other health insurance options.

What Employers Must Provide COBRA Benefits?

Generally, COBRA applies to employers with 20 or more employees on at least 50% of their working days during the prior calendar year. However, some states have enacted "mini-COBRA" laws that may extend coverage to smaller companies.

Which Benefits Are Covered?

COBRA allows you to continue coverage under the same health plan you had while employed. This includes medical, surgical, and prescription drug coverage as outlined in your employer's plan.

Which Events Trigger COBRA?

Several qualifying events can trigger your eligibility for COBRA coverage. They are:

• Involuntary job loss: This includes termination for reasons other than gross misconduct, as well as reductions in hours that cause you to lose health insurance coverage.
• Voluntary job termination: If you voluntarily resign, you may still qualify for COBRA.
• Reduction in work hours: If your hours are reduced to a point where you lose health benefits, COBRA may be an option.
• Death of a covered spouse: Your dependents may be eligible to continue coverage under COBRA.
• Divorce or legal separation: Your spouse and dependent children may be eligible to continue coverage under COBRA.
• Eligibility for Medicare: If you become eligible for Medicare, you may still be able to continue your employer-sponsored plan under COBRA for a limited time.

How Long Does COBRA Coverage Last?

The duration of COBRA coverage depends on the qualifying event:

• Involuntary job loss or reduced hours: The standard COBRA continuation period is 18 months in these cases.
• Other qualifying events: For events like divorce or the death of a spouse, the continuation period may be 36 months.
• Disability extension: Under certain circumstances, individuals deemed disabled by the Social Security Administration (SSA) may be eligible for an extended COBRA period, potentially reaching a total of 29 months.

COBRA Election Notice to Include Health Exchange Information

Your employer is required to provide you with a COBRA election notice within 60 days of the qualifying event. This notice will detail your rights and responsibilities under COBRA, including the cost of coverage and the deadline to elect coverage. Importantly, the notice should also include information about the health insurance Marketplace as a potential alternative to COBRA.

Paying for COBRA Coverage

Under COBRA, you become responsible for paying the full premium cost for your health insurance coverage. This includes the portion previously paid by your employer, which can make COBRA a significantly more expensive option than your employer-sponsored plan.

Find the Right Health Insurance Coverage for Your Needs with Us

Don't navigate the complexities of health insurance alone! Our experienced agents at Everett Callahan Insurance Agency can answer your questions about COBRA coverage, guide you through the enrollment process, and help you find the best health insurance plan for your situation. Let us help you stay covered and secure your financial relief. Contact us today to get started. Call us at (800) 624-8976 for further assistance.

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