Your employer must give you information about COBRA benefits within a certain of the qualifying event. The election notice will include the name of the administrator, instructions on how to sign up, and places to get more details.
Before the COVID-19 pandemic, employers had 45 days to issue COBRA election paperwork. However, the pandemic changed the deadline to within 14 days. If the company fails to provide the application and information, the U.S. Department of Labor will fine it.
A qualifying event could include:
- Giving your resignation or quitting.
- Getting fired for anything except gross misconduct.
- Being laid off.
- A reduction of hours, like switching to part-time from full-time, which results in the loss of health insurance.
- Becoming eligible for Medicare.
- Losing coverage through your spouse, such as through legal separation, divorce, or death.
- Maturing out of coverage through your parent (26 years of age).
Is COBRA a continuation of your current insurance with your employer? Yes, it is a temporary extension of your coverage. However, you will need to pay the entire premium, as your former employer will no longer cover the portion that was a benefit of your employment.
You will have 60 days to choose to elect or refuse the COBRA insurance quote. If you select COBRA coverage, you cannot sign up for insurance through the Marketplace until the next open enrollment period.
You may decide against COBRA insurance if you are starting a new job and have coverage with that employer, you will be under your spouse’s insurance, or you want a different type of insurance policy. If you are considering declining COBRA because of the higher premium, you can find financial assistance.
You can change your mind about declining COBRA coverage as long as you are still within the 60-day election period. Should you enroll on COBRA, your coverage will bed retroactive to the day when you lose your employer-sponsored health insurance.
Is COBRA better than individual health insurance found in the Marketplace? It would help if you compare your current insurance with the ones available on the Marketplace. You may find coverage that works for your needs at a more affordable rate.
With the health insurance tax subsidies, Marketplace insurance policy premiums may be significantly less than the COBRA insurance cost. However, the coverage may not be as comprehensive as your employer-sponsored policy.
A Marketplace plan may be a better option if you do not plan to have health insurance before the end of the COBRA coverage period.