Federal COBRA

What is it?
COBRA is a federal program that offers employees and their covered dependents the opportunity to continue their group health coverage when it might otherwise be lost. The cost of this coverage is paid by the employee and can be up to 102% of the premium.

Who does it cover?
All employers with 20 or more employees offering group health coverage must offer COBRA coverage. COBRA covers employees and dependents who would lose their coverage because:

• The employee’s job ends or hours are reduced
• They become divorced or legally separated from the employee
• They are no longer considered a dependent (e.g. child reaches the maximum age)
• The employee enrolls in Medicare
• Death of the employee

How is it administered?
Administration duties fall upon the employer:  

• Provide all eligible new employees with information about COBRA
• Notify the carrier when a qualifying event has taken place
• Provide the employee and/or dependents with COBRA election materials
• Collect COBRA premiums
• Notify the participant(s) when their coverage ends

How long does it last?
COBRA coverage lasts up to 18 months for an employee, and up to 36 months for a spouse and/or dependents but can end sooner if:

• Premiums are not paid in a timely manner
• Participant becomes covered under another group health plan
• Participant enrolls in Medi-Cal or Medicare

Additional information regarding COBRA can be found  here.

Ask us about our COBRA administration services.