Overview: Group health plans sponsored by employers with 20 or more employees are required to comply with the Consolidated Omnibus Budget Reconciliation Act (COBRA). In general, COBRA provides continuation of health care coverage for employees and their beneficiaries who would otherwise lose coverage due to certain qualifying events.
Group health plans are required to provide workers and their families with a notice of their COBRA rights and are also required to have procedures in place for how COBRA coverage is offered, how coverage can be elected and how coverage can be terminated. Even though COBRA has been around for over 25 years, its confusing and complex requirements still result in frequent errors.
Some of the more common errors include:
Trends: In light of the US Supreme Court's decision striking down section 3 of the federal Defense of Marriage Act (DOMA), employers must extend COBRA coverage to an employee's same-sex spouse if the couple lives in a state that recognizes same-sex marriage. The number of states that recognize same-sex marriage is continuing to grow, with rulings addressing the legality of same-sex marriage pending in several states.
Author: Tracy Morley, SPHR, Legal Editor
Updated to reflect the forthcoming Arizona health care continuation coverage law.
Updated to include forthcoming continuation coverage law applicable to small employers.
Updated to reflect an amendment regarding termination for gross misconduct, effective July 1, 2018.
Use this workflow to determine what steps to take when a qualifying event occurs under the Consolidated Omnibus Budget Reconciliation Act (COBRA).
Updated to reflect the reduced supplemental withholding rates under the tax reform law enacted on December 22, 2017, effective January 1, 2018.
Updated to reflect additional health insurance Marketplace information that may be included with an election notice.
Employees and their spouses must receive a general notice of rights under the Consolidated Omnibus Budget Reconciliation Act (COBRA) within 90 days of the beginning of group health plan coverage.
Qualified beneficiaries must receive a Consolidated Omnibus Budget Reconciliation Act (COBRA) election notice within 44 days of a qualifying event.
HR Guidance on complying with COBRA laws and regulations.