Heath insurance is one of the most important employment benefits in existence, but after losing a job, many workers worry about losing their insurance coverage. This is a valid concern, but under COBRA laws, employees who voluntarily resign or are terminated for any reasons besides gross misconduct may choose to continue their coverage during periods of unemployment. This is a federal law, and your employer is required to provide you with insurance continuation options. Read the following information to understand more about COBRA and its impact on your health insurance.
How Long Does COBRA Coverage Last?
An employee may receive health insurance coverage starting the day after his or her termination for a period of up to 18 months. This coverage is extended to 36 months if the employee’s insurance policy includes a dependent child or spouse. Your employer will be required to make an initial payment within 30 days of an employee choosing to continue a policy. The employee will be responsible for covering the actual cost of COBRA insurance.
Employees who were covered by their employer’s group health insurance plan can elect to extend their benefits through COBRA. This includes medical, dental, and employee assistance plans, in addition to any other employer-provided plans. In order for COBRA to begin, the unemployed worker must notify their health plan administrator 30 to 60 days after termination. The employee, dependent child, or spouse will be required to purchase COBRA over the following 60 days. If an employer fails to inform his or her workers about COBRA, the employer will face legal fines and other penalties. If a company goes out of business, it will not be required to offer COBRA to workers.
All full and part-time employees who receive employer-provided health insurance are eligible to continue COBRA insurance coverage. The U.S. Department of Labor has officially stated that employers with 20 or more workers enrolled in its group insurance plan must offer COBRA coverage. The employee must be a qualifying beneficiary, or a person who was enrolled prior to termination, and a qualifying event, or an act that would lead an employee to lose health insurance, must have occurred. Loss of employment, divorce, or a reduction in working hours are all considered qualifying events.
If you elect to enroll in a COBRA health plan, you will be required to make all necessary premium payments throughout the duration of the policy. Various obligations and plan stipulations usually allow for a 30-day grace period, in addition to other payment options such as conversion plans, disability considerations, and extensions. There are also COBRA provisions that provide qualified enrollees with a federal subsidy for up to 15 months. This subsidy may be able to cover up to 65 percent of your premium cost during this period.
Can You Benefit From COBRA?
For individuals with health issues, COBRA can ensure that your current insurance plan does not end with your employment. If you do not have insurance coverage during a period of unemployment, you may not be able to pay for medical expenses such as doctor’s appointments, medications, emergency care, and preventive treatments. It is important to note that COBRA insurance will be terminated once you enroll in another employer’s group health plan.
As mentioned above, you may qualify for COBRA if you lose your job due to termination, layoffs, or resignation. If you were terminated for poor performance, attendance issues, or any reasons stemming from your conduct or behavior, you will not be eligible for COBRA. If you have been terminated for the aforementioned reasons, you should explore other health insurance options.
If you have any additional questions regarding COBRA insurance and benefits, you should view the COBRA Continuation Health Coverage FAQ or contact the Department of Labor. If you believe that your COBRA rights have been violated by your employer, you should consult an employment lawyer immediately. Click to view more Human Resources
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