Can I Continue Cobra Insurance After 18 Months?

COBRA, the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended provides for continuing insurance coverage to certain individuals who would otherwise lose their health care coverage as the result of certain specified events.

Basics

• Employers who employ more than 20 employees on a regular business day and who sponsors a group health plan must offer COBRA continuation coverage to individuals who become eligible for it. Those individuals are called qualified beneficiaries.

Qualified Beneficiaries

• A qualified beneficiary is an individual whose status is determined on the day before the qualifying event. A participant in an employer's health plan, that participant's spouse or dependent child, including a child born after the qualifying event, are all eligible to be qualified beneficiaries.

Qualifying Events

• A qualified beneficiary must experience a qualifying event in order to become eligible for COBRA continuation coverage. The following are considered qualifying events for qualified beneficiaries to be eligible for COBRA continuation coverage provided that the occurrence of one of these events would result in the loss of their health coverage. Qualifying events are: the death of a covered employee, termination of employment or reduction of a covered employee's hours, the divorce or legal separation of the covered employee from the employee's spouse, the covered employee becoming entitled to receive Social Security benefits, a dependent child ceasing to be a dependent child under the generally applicable requirements of the health care plan.

Duration

• In general, COBRA continuation coverage is available until the earliest of the following to occur: 18 months after the date of the qualifying event; if there are multiple qualifying events, 36 months after the date of the qualifying event; if a qualified beneficiary is entitled to Medicare and then has a qualifying event, 36 months; and if the eligible individual is determined to be disabled at anytime during the first 60 days of continuation coverage, then the qualified beneficiary will have 29 months of continuation coverage if the qualified beneficiary has provided notice of such disability determination before the end of the 18-month period. These time periods represent statutory minimums and an employer may offer more generous continuation coverage.

Miscellaneous

• COBRA insurance must consist of identical coverage to that provided by the employer to similarly situated beneficiaries who have not yet experienced an event that would qualify them as a COBRA beneficiary. Qualified beneficiaries must have at least 60 days to elect COBRA continuation coverage and if coverage is elected, the qualified beneficiary must pay premiums equal to up to 102 percent of the applicable premium for such coverage.