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Learn the basics about COBRA

COBRA is the acronym for The Consolidated Omnibus Budget Reconciliation Act. COBRA gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events. Qualified individuals may be required to pay the entire premium for coverage up to 102 percent of the cost to the plan.

Use this weblink to get to the US Department of Labor’s website to review the details concerning COBRA. Some states have laws that apply to groups that fall below the threshold for COBRA to apply. Refer to your local department and insurance for further guidance.

TIPS:

Employers

Know when this law applies to your organization and employees enrolled in your group health plans.

Understand your responsibilities and provide timely and accurate "in the door" and "out the door" notices to your employees and their dependents. Be aware of what events may cause the need for a COBRA notice to be sent.

Create and use a solid internal procedure to handle COBRA issues or outsource the whole process to a professional organization.

Keep current with the changes in the law and administration guidelines from the US Department of Labor. There are cash penalties for non-compliance.

Watch out for COBRA’s interaction with other employee protection laws & other employee benefits programs.

Consumers

Understand your rights as a continuee and follow the instructions on your COBRA notice. If you elect to continue coverage under COBRA law remember to pay your premium in a timely manner and keep your employer informed of any address changes.