What is COBRA health insurance?

The Consolidated Omnibus Budget Reconciliation Act (COBRA) health benefit provisions amend the Employee Retirement Income Security Act, the Internal Revenue Code and the Public Health Service Act to require group health plans to provide a temporary continuation of group health coverage that otherwise might be terminated. Q2: What does COBRA do?

What if I don’t take Cobra?

If you decide not to take COBRA coverage, you can enroll in a Marketplace plan instead. Losing job-based coverage qualifies you for a Special Enrollment Period. This means you have 60 days to enroll in a health plan, even if it’s outside the annual Open Enrollment Period. See 2020 plans…

Who administers the COBRA continuation coverage law?

COBRA continuation coverage laws are administered by several agencies. The Departments of Labor and Treasury have jurisdiction over private-sector group health plans. The Department of Health and Human Services administers the continuation coverage law as it applies to state and local governmental health plans.

Is there a tax credit for COBRA continuation insurance?

Certain individuals may be eligible for a refundable Federal income tax credit that can help with qualified monthly premium payments. The Health Coverage Tax Credit (HCTC), while available, may be used to pay for specified types of health insurance coverage (including COBRA continuation coverage).

Who is responsible for Cobra coverage in an asset sale?

In an asset sale, a group health plan of the buying group is responsible for providing COBRA coverage to M&A qualified beneficiaries if: The selling group ceases to provide any group health plan to any employee in connection with the sale; and

Do mergers and acquisitions affect Cobra coverage?

Mergers and acquisitions raise COBRA coverage issues for qualified beneficiaries. The IRS has issued COBRA regulations that address business reorganizations. The seller’s group health plan is typically responsible for providing COBRA coverage, unless the parties agree otherwise.

Why is Cobra so expensive?

For some people, the cost of COBRA can be unmanageable. This is because the employer is the one who is responsible for the lion’s share of the monthly premiums when you have job-based insurance. A 2020 study from the Kaiser Family Foundation reported that employers pay an average of 83% of the cost of an employee’s health insurance.

Who is responsible for Cobra enrollment?

Since COBRA is a law and not a company, the employer who sponsored the group health insurance is responsible for facilitating enrollment, premium payments and cancellations. The Way It Works. You lose the insurance you had through an employer. The employer sends you paperwork to enroll into the plan you just had. You have 60 days to respond.