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Job Loss? Know Your Rights About Continuing Your Health Insurance Benefits

As we move on from last week’s blog, many employees faced with termination often ask what happens to their health insurance benefits.  Both federal and state law generally permit you to continue your current health insurance coverage at your own expense when there is a job loss. Although coverage can also be continued in other qualifying situations, this article specifically addresses medical insurance related to separation from employment.  Federal law, the Consolidated Omnibus Budget Reconciliation Act of 1985, commonly referred to as COBRA, applies to employers with 20 or more employees.  The Florida state law equivalent of COBRA is often referred to as mini-COBRA and applies to smaller employers with less than 20 employees.  

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Below are some commonly asked questions about COBRA:

1.  How Do I Learn About My Rights and Costs to Continue My Health Insurance Coverage?

  • Generally, COBRA requires your covered employer to notify you within 44 days of the termination date. This timeframe includes 30 days for your employer to notify the insurance plan that a dismissal from employment occurred and then 14 more days for the insurance plan to send you the COBRA notice.  You need to be on the lookout for this notice as your rights to continue your insurance coverage are time sensitive.
  • Unlike federal COBRA, mini-COBRA does not require your employer to notify the insurance plan of the termination of coverage.  Instead, the obligation is on you, the “qualified beneficiary,” to give written notice to the insurance carrier within 63 days after the date you are fired.  After notifying the carrier about your termination, the insurance carrier has up to 14 days to notify you about how to elect your continued coverage, how much it will cost and your deadline to elect mini-COBRA coverage to keep it active.  Please note that just notifying the insurance plan of your termination IS NOT considered your election for coverage.  After notification of your discharge, the insurance carrier will send you additional information regarding how to elect your coverage.
  • This means that you will likely have no insurance coverage before receiving your COBRA notice from your insurance carrier.  However, this will not be an issue if you timely elect to continue your coverage under either COBRA or mini-COBRA. Once elected, your COBRA health insurance benefits should run retroactively back to your termination date.  For example, if you were terminated on June 1, 2019, but made your continuation election by July 1, 2019, your insurance is effective from June 1, 2019, and there is no lapse in coverage.

2.  Who Pays the Cost of COBRA and/or Mini-COBRA? 

  • Typically, you are responsible for the entire premium—this means both the employer’s portion and the employee’s portion, unless there is an agreement for your employer to pay the entire premium amount or a partial payment towards the health insurance premium.  These premiums can be rather hefty, but paying them allows you to keep your coverage at the same level as if you were still employed, which is especially important if you have pre-existing conditions or have already met your deductible for the year.

3.  How Long Does COBRA and/or Mini-COBRA last? 

  • Under both COBRA and mini-COBRA, health insurance coverage continuation can last up to 18 months. 

4.  Can I Continue My Health Insurance Benefits if I Voluntarily Quit My Job?

  • Generally, yes. Both COBRA and mini-COBRA allow for you to continue your health insurance upon the termination of a covered employee’s employment.

5.  What If I am Terminated for Misconduct, Can I Still Continue My Health Insurance Benefits?

  • That depends.  If you are terminated for “gross misconduct,” you are not eligible for continued health insurance coverage under COBRA or mini-COBRA. Gross misconduct, while not specifically defined in the language of the statutes, is typically a pretty high standard.  However, what constitutes gross misconduct will depend on your specific circumstances, so if you have any doubt it is always a good idea to ask an experienced employment lawyer whether the events surrounding your termination rise to the level of gross misconduct.

Have more questions regarding COBRA and your rights? We urge you to consult an experienced employment attorney to answer your questions.

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