An insured or self-funded health plan that provides medical coverage to employees and their dependents must provide the employees and dependents the right to continue coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA) if that coverage is lost because of a qualifying event. COBRA requires that a qualified beneficiary be permitted to elect continuation coverage within an applicable election period.
COBRA applies to employers with 20 or more employees. However, South Carolina insurance laws require continuation coverage for insured group health plans that are not covered by COBRA.
COBRA requires that a notice be provided when health coverage first becomes effective. Under the law, a group health plan must provide written notice of COBRA rights to each covered employee and covered spouse (if any). This notice must be provided within 90 days of the date an individual becomes covered under a group health plan governed by COBRA. Failure to provide this initial notice, as well as failure to provide the qualifying event notice, subjects a plan administrator to penalties under both ERISA and the IRC.
When certain qualifying events occur, COBRA requires that employees and dependents...
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