Thursday, March 18
COBRA Insurance: What it is.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) was established in 1986 to solve gaps in health coverage to terminated employees under certain circumstances. Mainly, it allows an employees who loses their health benefits the option to choose to continue group health benefits provided by their company 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, making once affordable health insurance seemingly a pocket-burner. Unfortunately few can afford paying full premium on a major medical plan, which in turns steers them to supplemental coverage or a COBRA alternative.
The type of qualifying event will determine who the qualified beneficiaries are and the amount of time that a plan must offer the health coverage to them under COBRA. A plan, at its discretion, may provide longer periods of continuation coverage.
Qualified individuals may be required to pay the entire premium for coverage up to 102 percent of the cost to the plan, making once affordable health insurance seemingly a pocket-burner. Unfortunately few can afford paying full premium on a major medical plan, which in turns steers them to supplemental coverage or a COBRA alternative.
The type of qualifying event will determine who the qualified beneficiaries are and the amount of time that a plan must offer the health coverage to them under COBRA. A plan, at its discretion, may provide longer periods of continuation coverage.
Qualifying Events for Employees:
- Voluntary or involuntary termination of employment for reasons other than gross misconduct
- Reduction in the number of hours of employment
Qualifying Events for Spouses:
- Voluntary or involuntary termination of the covered employee's employment for any reason other than gross misconduct
- Reduction in the hours worked by the covered employee
- Covered employee's becoming entitled to Medicare
- Divorce or legal separation of the covered employee
- Death of the covered employee
Qualifying Events for Dependent Children:
- Loss of dependent child status under the plan rules
- Voluntary or involuntary termination of the covered employee's employment for any reason other than gross misconduct
- Reduction in the hours worked by the covered employee
- Covered employee's becoming entitled to Medicare
- Divorce or legal separation of the covered employee
- Death of the covered employee
Go to COBRA Insurance for more information or answers.
Labels: COBRA, cobra subsidy, Insurance, unemployed
¶ 4:55 PM
