The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their 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.

 

COBRA generally requires that group health plans sponsored by employers with 20 or more employees in the prior year offer employees and their families the opportunity for a temporary extension of health coverage (called continuation coverage) in certain instances where coverage under the plan would otherwise end. COBRA outlines how employees and family members may elect continuation coverage. It also requires employers and plans to provide notice.

 

If you are an employee, you will become a qualified beneficiary if you lose your coverage under the Plan because either one of the following qualifying events happens:. 

• Your hours of employment are reduced, or

• Your employment ends for any reason other than your gross misconduct. 

 

If you are the spouse of an employee, you will become a qualified beneficiary if you lose your coverage under the Plan because any of the following qualifying events happens:

• Your spouse dies;

• Your spouse's hours of employment are reduced;

• Your spouse's employment ends for any reason other than his or her gross misconduct;

• Your spouse becomes entitled to Medicare benefits (under Part A, Part B, or both); or

• You become divorced from your spouse.

• Your dependent children will become qualified beneficiaries if they lose coverage under the Plan because any of  the following qualify events happens:

• The employee dies;

• The employee's hours of employment are reduced;

• The employee's employment ends for any reason other than his or her gross misconduct;

• The employee becomes entitled to Medicare benefits (Part A, Part B, or both);

• The employee and spouse become divorced; or

• The child stops being eligible for coverage under the plan as a dependent child.