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Note: For
information
on the COBRA provisions in the American Recovery and Reinvestment Act of
2009, see www.dol.gov/COBRA.
Throughout a career, workers will face multiple life events, job changes or
even job losses. A law enacted in 1986 helps workers and their families keep
their group health coverage during times of voluntary or involuntary job
loss, reduction in the hours worked, transition between jobs and in certain
other cases.
The law — the Consolidated Omnibus Budget Reconciliation Act (COBRA) —
gives workers who lose their health benefits the right to choose to continue
group health benefits provided by the plan under certain circumstances.
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.
The law generally covers group health plans maintained by employers with 20
or more employees in the prior year. It applies to plans in the private
sector and those sponsored by state and local governments. Provisions of
COBRA covering state and local government plans are administered by the
Department of Health and Human Services.
Several events that can cause workers and their family
members to lose group health coverage may result in the right to COBRA
coverage. These include:
-
Voluntary or involuntary termination
of the covered employee’s employment for reasons other than gross
misconduct
-
Reduced hours of work for the
covered employee
-
Covered employee becoming entitled
to Medicare
-
Divorce or legal separation of a
covered employee
-
Death of a covered employee
-
Loss of status as a dependent child
under plan rules
Under COBRA, the employee or family member may qualify to keep their group
health plan benefits for a set period of time, depending on the reason for
losing the health coverage. The following represents some basic information
on periods of continuation coverage:
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