Information on COBRA Regarding Washington Health Insurance

COBRA (Consolidated Omnibus Budget Reconciliation Act)

COBRA extends health plan benefits to employees who lose medical coverage because they lost their job or had their hours reduced. Most group health plans provided by companies with 20 or more employees are subject to COBRA.

If an employee, spouse, or dependent are covered by the group health plan on the day before a qualifying event, then they may be eligible to continue buying coverage under the group plan for 18-36 months.

A qualifying event for an employee is a reduction in hours or losing a job for reasons other than "gross misconduct."

A qualifying event for a spouse or dependent includes reduction in hours or termination of the employee (as described above), or:

• Divorce or legal separation from the employee
• Death of the employee
• The employee becomes eligible for Medicare
• Loss of "dependent child status"

Individuals who experience a qualifying event should check with the employer to find out if they are eligible for COBRA benefits. A qualified individual must notify the plan administrator of a qualifying event within 60 days after divorce or legal separation, or a child's loss of dependent status under the plan.

Each family member or dependent has the right to elect COBRA coverage.

Enrollees generally pay for COBRA coverage themselves. The COBRA plan administrator may charge up to 102 percent of the total cost of the group plan, which includes the portion previously paid by the employer.

An individual who already has other coverage (including Medicare) on or before the date he or she becomes eligible for COBRA, may continue that coverage along with COBRA coverage. But if the individual qualifies for an employer plan or Medicare after qualifying for COBRA coverage, the employer may terminate the COBRA coverage. However, the employer cannot stop coverage if the new plan has a pre-existing condition clause that applies to the individual.

Not all plans terminate COBRA coverage immediately upon Medicare eligibility, so check with the plan administrator. Generally, dependents are able to continue COBRA coverage even if the primary employee (ex-employee) becomes Medicare-eligible.

For more information on COBRA, call the U.S. Department of Labor (DOL) Employee Benefits Security Administration at 1-866-444-3272, or check with your employer's human resource office.

Small employer plans (20 or fewer employees) are not required to offer COBRA coverage, but may offer a limited continuation right for terminating employees and their dependents. A plan's benefit booklet should provide details of the continuation benefit.