Cobra Health Insurance Between Jobs

When you leave your job, you may lose your employer-sponsored health insurance. This can be a major concern, especially when you have ongoing health needs or are in the middle of treatment. Fortunately, there is a safety net available for people in this situation: COBRA.

What is COBRA?

COBRA stands for Consolidated Omnibus Budget Reconciliation Act. It is a federal law that allows you to continue your employer-sponsored health insurance for a certain period of time after you leave your job. This means that you can temporarily keep the same coverage you had while you were employed.

COBRA coverage can be especially important for people with pre-existing conditions or ongoing medical needs. Without it, they might not be able to get the care they need or might have to pay much higher out-of-pocket costs.

How does COBRA work?

Under COBRA, you have the right to continue your employer-sponsored health insurance for up to 18 months (or longer in certain circumstances). You will need to pay the full premium for your insurance, including the portion your employer used to pay. Your employer can no longer contribute to your premium once you leave your job.

COBRA coverage is available for you, your spouse, and your dependent children. You will have 60 days from the date you receive notice from your employer to decide whether to elect COBRA coverage.

If you choose to enroll in COBRA coverage, you will be responsible for paying premiums on time. If you miss a payment or are late, your coverage could be terminated. You should also be aware of the time limit for COBRA coverage, as it is not permanent.

Why might you need COBRA coverage?

There are several reasons why you might need COBRA coverage:

Job loss

When you lose your job, you may also lose your employer-sponsored health insurance. COBRA can help you continue your coverage until you find a new job or other coverage.

Job change

If you change jobs, you may have a waiting period before your new employer-sponsored health insurance takes effect. COBRA can help you bridge the gap between jobs.

Divorce or separation

If you were covered under your partner’s employer-sponsored health insurance and you divorce or separate, you may no longer be eligible for that coverage. COBRA can help you continue your own coverage.

Retirement

When you retire, you may lose your employer-sponsored health insurance. COBRA can help you continue your coverage until you are eligible for Medicare.

How much does COBRA coverage cost?

COBRA coverage can be expensive, as you will need to pay the full premium for your insurance. This means that you will be responsible for the portion of the premium that your employer used to pay as well as your own portion. You may also be charged an administrative fee.

The cost of COBRA coverage will vary depending on your employer and your health plan. It is important to carefully consider the cost of COBRA coverage and whether it is worth it for your situation.

FAQ

What happens if I don’t elect COBRA coverage?

If you do not elect COBRA coverage within 60 days of receiving notice from your employer, you will lose the option to do so. This means that you will no longer be able to continue your employer-sponsored health insurance after you leave your job.

Can I switch to a different health plan under COBRA?

No, you cannot switch to a different health plan under COBRA. You can only continue the same coverage you had while you were employed.

How long does COBRA coverage last?

COBRA coverage can last for up to 18 months (or longer in certain circumstances). You should carefully review the terms of your coverage and the time limit for COBRA to ensure you are aware of when it will end.

Can I keep my COBRA coverage if I move to a different state?

Yes, you can keep your COBRA coverage if you move to a different state. However, you should check with your health plan to ensure that your coverage will still be valid in the new state.

Pros
Cons
Allows you to continue your employer-sponsored health insurance
Can be expensive
Important for people with pre-existing conditions or ongoing medical needs
Does not allow you to switch to a different health plan
Can help bridge the gap between jobs or until you are eligible for Medicare
Not permanent coverage