How to Obtain COBRA When You're Waiting for New Job Insurance to Kick In

COBRA, short for the Consolidated Omnibus Budget Reconciliation Act, allows workers and their families to maintain health care insurance in the event of a job loss, reduction of hours, death or divorce, according to the U.S. Department of Labor. When COBRA is available, the insured is responsible for paying all premiums. Workers and family members are not require to sign up for COBRA, but they may elect to do so if they meet the requirements and follow the procedures to begin coverage.

Instructions

Qualify for COBRA

• 1

  Make sure your employer (or former employer) offers COBRA. According to the U.S. Department of Labor, workers from companies offering group health insurance and having at least 20 employees for at least half of the previous year are eligible for COBRA. If you are unsure, check with your human resources manager or direct supervisor.

• 2

  COBRA beneficiaries can include the employee, spouse and dependent children. The beneficiary must have been covered under the group health insurance plan the day prior to the "qualifying event" (discussed in next step). Independent contractors, agents and directors who are enrolled in the group health plan also qualify, according to the U.S. Department of Labor.

• 3

  Verify that your reason for needing COBRA coverage is a "qualifying event." These reasons include termination of employment, reduction of hours, entitlement to Medicare, death, divorce or a child ceasing to be a dependent.

Process to Elect Coverage

• 4

  Notify your employer's health plan administrator you want to obtain COBRA coverage. Notification must be given within 30 days if the qualifying event is termination of employment, reduced hours, entitlement to Medicare or death. The period is 60 days if it concerns divorce or a child ceasing to be a dependent.

• 5

  Send a notice of election of COBRA benefits no later than 14 days after the plan administrator receives notice of the qualifying event. The notice must be from the person wishing to obtain COBRA, or the parents or guardians of a minor child.

• 6

  Decide whether to extend COBRA continuation coverage. A beneficiary has 60 days to make this decision.

• 7

  Pay the initial premium within 45 days of electing coverage. Failure to pay the premium can result in a loss of insurance. According to the U.S. Department of Labor, the cost can not exceed 102 percent of the cost to the plan.