The Consolidated Omnibus Budget Reconciliation Act allows former employees and other eligible individuals an extension of employer-sponsored group health insurance.
Function
According to the Department of Labor, "COBRA provides certain former employees, retirees, spouses, former spouses, and dependent children the right to temporary continuation of health coverage at group rates."
Time Frame
Coverage under COBRA typically lasts for 18 months. In addition, if the Social Security Administration has declared you disabled within the first 60 days of COBRA coverage, you may be eligible to extend the coverage for a longer period.
Benefits
COBRA beneficiaries can typically maintain the same benefits that they received under their employer-sponsored health plan.
Considerations
Although COBRA coverage is typically less expensive than individual health coverage, the premiums can still be expensive since you are paying the entire premium rate, as opposed to just paying your portion of the premium rate, which was subsidized by your employer.
Warning
You must obtain COBRA coverage no later than 60 days from the date that you lost coverage with your employer.
Tags: COBRA coverage, former employees, health coverage, premium rate, your employer