This coverage ended Dec. Employers recoup the premiums through Medicare tax credits. You are eligible for the COBRA premium subsidy if you lost coverage due to a reduction in hours or involuntary termination of employment. If, however, you are eligible for other group health plan coverage or Medicare, you will lose eligibility for the COBRA subsidy. You are required to self-report your eligibility for other coverage to the COBRA plan and will face a tax penalty if you do not.
In order to begin COBRA coverage, an individual must confirm that they are eligible for assistance according to the requirements listed above. Typically, an eligible individual will receive a letter from either an employer or a health insurer outlining COBRA benefits.
Some individuals find this notification difficult to understand because it includes a large amount of required legal information and language. If you have any difficulty determining whether you are eligible for COBRA or how to begin coverage through this program, contact either the insurer or your former employer's HR department.
For individuals either not eligible for COBRA or those searching for alternatives, there are other options, such as a spouse's health insurance plan. For individuals either not eligible for COBRA or those searching for alternatives, there are other options.
In some cases, a spouse's health insurance plan may be a possibility. Or you might explore your options on the federal health insurance marketplace or a state insurance marketplace. Loss of a job will open up a special enrollment period. As indicated above, Medicaid programs and other short-term policies designed for those experiencing a gap in health coverage may also be available to you.
Health insurance professionals typically discourage individuals from electing to go uninsured entirely , as the possibility of severe downsides is high—especially during an uncertain time. Fortunately, individuals eligible for COBRA coverage have at least 60 days to elect to participate in the program. COBRA is a convenient option for retaining health insurance if you lose your employer-sponsored benefits, and sometimes it is also the best option.
However, the cost is often high and the plan is not always the best one to fit an individual's or a family's needs. Employee Benefits Security Administration.
The Commonwealth of Massachusetts. Department of Labor. Accessed May 10, Internal Revenue Service. Health Insurance. Life Insurance. Your Privacy Rights. To change or withdraw your consent choices for Investopedia. At any time, you can update your settings through the "EU Privacy" link at the bottom of any page. These choices will be signaled globally to our partners and will not affect browsing data.
We and our partners process data to: Actively scan device characteristics for identification. I Accept Show Purposes. Your Money. Personal Finance. Your Practice. Federal government websites often end in. The site is secure. The Consolidated Omnibus Budget Reconciliation Act COBRA gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events.
Federal coverage lasts 18 months, starting when your previous benefits end. Some states extend medical coverage but may not include dental or vision to 36 months. Depending on your situation, you may qualify for other health benefits:. Be sure to shop around ahead of time to avoid any lapse in coverage.
Christina Joseph Robinson is a veteran editor and writer from New Jersey who still loves to read the old-fashioned newspaper. Links to various non-Aetna sites are provided for your convenience only. Aetna Inc. The information you will be accessing is provided by another organization or vendor. If you do not intend to leave our site, close this message. Each main plan type has more than one subtype. Some subtypes have five tiers of coverage. Others have four tiers, three tiers or two tiers.
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Do you want to continue? Individuals overview. If you do not choose COBRA and never pay any of the premiums for it, the loss of group coverage triggers a special enrollment period on your state health insurance marketplace. The fastest ways to get a plan on the state marketplace are:. The length of time you can keep COBRA coverage depends on your qualifying event see the next section. Note that a few states require employers to offer COBRA coverage for a longer time than federal laws do.
A qualifying event causes employees or their dependents to lose their group health coverage but lets them qualify for COBRA coverage.
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