Health Insurance 2
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Does the COBRA law apply to all companies that have twenty or more employees?
No. Some government, church, and self-insured plans are exempt from the COBRA law, so be sure to check before assuming you can continue coverage.
What are qualifying events?
The following five events are considered qualifying events under COBRA:
1. You cease to be an employee for any reason other than gross misconduct.
2. You change from full-time to part-time employment and no longer qualify for the company's health care plan due to the reduction in hours you work.
3. You are the spouse of the insured and lose coverage due to divorce, legal separation, or the death of the insured.
4. You are a child who ceases to be eligible for group plan benefits.
5. You become entitled to Medicare benefits.
How long do I have before I have to decide whether to continue the coverage under COBRA?
Your group plan administrator is supposed to notify you within 14 days of a qualifying event of your right to continue the coverage. You then have 60 days from the date your coverage would otherwise end to elect coverage, which will be retroactive to the time you became ineligible for your employer's plan. You then have up to 45 days to pay the first premium.
If the employer changes insurance plans, what happens to my coverage?
Although you, personally, pay for the continuation coverage, it is under the employer's policy. Thus, if the employer changes to a new carrier and/or plan, your coverage changes to the same carrier and/or plan. If the employer should stop offering health insurance, your coverage would be terminated along with all the others that were under the company health plan.
What will it cost me to continue my present coverage?
The rate for the coverage is the same rate your employer is charged plus a 2 percent administrative cost. If you pay part and the employer pays part of the cost now, the amount you pay will be the combined amount (your share plus the employer's share).
Can I lose this coverage in any way?
The continuation coverage terminates at the end of the continuation period or if any of the following occurs:
- You don't pay the premium when it is due (most states have a 30 day grace period).
- You become covered as an employee under some other plan.
- You remarry and become included under the new spouse's group health insurance.
- You become eligible for Medicare.
- Your former employer ceases to provide group health care for all employees, terminating the plan.
Can the insurance company refuse individual coverage for me or my family at the end of the continuation period?
If you haven't let the policy lapse, they can't refuse to insure you; however, rates may be higher and coverage not as good as the group plan.
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