What Do You Need to Know About COBRA Insurance?

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COBRA, or the Consolidated Omnibus Budget Reconciliation Act, offers health care benefits for people, their families and their minor children if they lose their employment. This is a means of maintaining insurance coverage for individuals and families following loss of jobs. This is a federal law designed to close the insurance gap for individuals who are losing their jobs or coverage by insurance. Learn what you need to know about COBRA before you buy how it operates and its alternatives. If you face any problem, call bad faith insurance lawyer to the earliest.

How Do Insurance Apply to COBRA?

COBRA is a safety net for people who are losing health benefits because of unexpected lifestyle changes, such as work loss or family death. If you buy COBRA coverage as a qualifying policyholder, you will be retaining the same health benefits that your employer-sponsored program did. As an employee, you will enjoy the same treatment and benefits that you do. Your employer can no longer assist cover the costs of health insurance however. To keep the insurance coverage yourself, you will have to cover 100% of the price.

Who Qualifies Coverage for COBRA?

Not all can get insurance protection from COBRA. It refers only to companies with 20 or more private sector workers, or local and state governments. If you fit the definition of a qualified party you can apply for COBRA.

  • Anyone who leaves work

  • A person facing termination

  • Anyone who is fired for anything other than gross misconduct

  • Anyone who loses insurance cover due to reduced hours

  • Anyone who loses cover due to divorce, death or another appropriate occurrence

  • Dependents whose parents die, divorce or legally separate

  • Dependents who turn 26 and lose cover under their parents

Your employer or health insurance provider will inform you of the COBRA health insurance alternative within 30 days of being eligible to apply. Within 60 days of a divorce or a child turning 26, you might need to inform your employer of eligibility. You have 60 days to decide whether you should buy a COBRA health plan or not. Within the first 18 months you can go for a cancellation at any time.

Are COBRA Retroactive Beneficial?

COBRA insurance premiums may depend on the form of cover. The Health Benefit Tax sheet will give you an idea of what to budget for. COBRA payments start when the first premium is issued by the insurance provider. If you initially reject coverage, you'll have 60 days to change your mind. If you want to purchase it later, you will be forced to pay premiums for the entire duration you were registered for. For example, even if you buy COBRA insurance on day 59, you'll have to pay the premiums for that 59-day period. In doing so, you will obtain retroactive health insurance coverage from the date you first applied for COBRA.

What Alternatives Are Available?

COBRA isn't the only health care choice if your employer or parents drop coverage. You may opt to purchase a private coverage package. You can also move to the insurance plan for your current employer, consider the health plan of your spouse, buy a short-term plan or apply for medical insurance. You can find those choices more economical than COBRA. Generally however, they have higher deductibles and give less coverage. By fact, you will have to pay the full amount for COBRA health care if you want to keep your employer's health program.

You can consult a bad faith insurance lawyer from The West Law Firm to know more about COBRA insurance and its benefits.

** Disclaimer: The above article does not imply a relationship between attorney and client, nor is it legal advice.