The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives employees, spouses and dependents who lose their health benefits after certain qualifying events (described below) the right to choose to continue group health benefits provided by their group health plan for limited periods of time. Employees (and their family members) must be covered by a group health plan on the day before a qualifying event in order to be eligible to elect COBRA coverage. Individuals who elect COBRA coverage may be required to pay up to 102% of the plan’s cost of such coverage.
COBRA generally requires that group health plans sponsored by employers with 20 or more employees (determined on a controlled group basis) in the prior year offer qualifying beneficiaries (employees and their families who were covered under the plan would lose coverage after a qualifying event) the opportunity for a temporary extension of health coverage. COBRA applies to plans providing the following types of benefits: medical, dental, vision, prescription drugs and healthcare flexible spending arrangements.
Qualifying events under COBRA are specific events which cause...
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