For „insured employees”, the only eligible event is dismissal (whether the dismissal is voluntary or involuntary), including through retirement or shortening of the period of employment. In this case, COBRA lasts eighteen months. The Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) amended the Public Health Service Act, the Internal Revenue Code and the Employee Retirement Income Security Act (ERISA) to require employers with 20 or more employees to provide temporary maintenance of group health insurance in certain situations where it would otherwise be terminated. COBRA generally requires that employer-sponsored group health insurance plans with 20 or more employees in the previous year offer employees and their families the option of a temporary extension of health insurance (called continuation coverage) in certain cases where the plan`s coverage would otherwise end. An eligible beneficiary is a person eligible for COBRA continuation coverage because they were covered by a group health insurance plan the day before an „eligible event”. Depending on the circumstances, the following individuals may be eligible beneficiaries: an „insured employee” (a term that includes active employees, dismissed employees and retirees); the spouse and dependent children of an insured worker; any child born or released for adoption by an insured employee during the COBRA coverage period; Agents; Independent; independent contractors and their employees; the employer`s directors; and for public sector health plans, policy makers and elected officials. COBRA describes how employees and their family members can choose continuation coverage. It also requires employers and plans to take a leave. As a general rule, the beneficiary must bear the full cost of COBRA coverage, although some employers choose to subsidize COBRA.
However, in the likely event that the employer decides not to subsidize COBRA, the COBRA premium may not exceed 100% of the cost of the group health insurance plan for persons in a similar situation who have not experienced an eligible event, including the portion paid by the employees and the portion paid by the employer prior to the eligible event. plus an additional 2% for administrative costs. Please note that the employer may charge up to 150% for an 11-month extension of COBRA coverage. Q12: What is the next step in the process once the health plan administrator has been notified of an eligible event in a timely manner? Plan administrators who receive notice of an eligible event must inform eligible beneficiaries of their right to choose COBRA coverage. Qualified beneficiaries have an independent right to vote and must therefore be informed in each case. If all eligible beneficiaries reside at the same address, plan administrators may either include separate notices of choice for each eligible beneficiary in a single letter to the employee and spouse, or send a single notice clearly identifying all eligible beneficiaries covered by the notice and explaining each person`s separate and independent right; choose the COBRA continuation cover. Each eligible recipient then has 60 days to decide whether to opt for continuation coverage. Eligible events are listed below: the death of the insured employee; the termination of the employment relationship or the shortening of periods of employment by an insured employee; the insured employee who is eligible for medicare; divorce or legal separation from the employee concerned; or a dependent child who is no longer dependent under the generally applicable requirements of the plan. The U.S. Department of Health and Human Services, through the Centers for Medicare & Medicaid Services (CMS), is responsible for the COBRA continuation coverage requirements of the PHS Act, which apply to state and local employers, including counties, municipalities, and public school districts, and the group health plans they sponsor. Q3: Who is responsible for COBRA in the public sector? COBRA Continuation Coverage Assistance Provides information about health insurance options.
The cobra notice of choice should include the address to which premium payments are to be sent and must be provided by the employer or group health plan administrator, as well as the amount of the premium payable and its due date. Note: For more information about COBRA Reward Assistance under the American Rescue Plan Act of 2021, see www.dol.gov/COBRA-subsidy In certain circumstances, if a person with a disability and non-disabled family members are qualified beneficiaries, they are eligible for an extension of COBRA continuation coverage up to 11 months for a total of 29 months. The criteria for this 11-month extension of disability are a complex area of COBRA law. We provide general information below, but if you have any questions about your disability and COBRA in the public sector, we recommend that you email us at phig@cms.hhs.gov.