Consolidated Omnibus Budget Reconciliation Act (COBRA)

What are the COBRA Insurance Laws? In 1986, the United States Congress passed a bill known as the Consolidated Omnibus Budget Reconciliation Act, or COBRA for short. One of the provisions set forth in this law were the COBRA health insurance laws. These laws were included to protect people from suddenly being without health insurance if they lost their job, quit their job, retired from their job, or had their hours reduced. It also included provisions to extend this coverage to family members. All of this effort was to ensure that no one would suddenly find himself or herself without health insurance and unable to get medical care. However like any government law or policy, COBRA insurance comes with some requirements and restrictions. Learn More

How to qualify? To be able to sign up for continued health care coverage using COBRA you must meet three main requirements. The first, commonly known as qualifying plan, is what kind of health plan you had while employed. For the federal law you need to have been on a medical plan that covered at least 20 employees. For state COBRA insurance plans, you can usually qualify if there are between 2-19 employees as long as your state has a Mini COBRA plan. The second condition is known as qualifying event and is how you lost your health insurance. For the covered employee this can be losing their job, quitting their job, or retiring from their job. For a beneficiary of the plan this could be the covered employee losing their insurance, divorce from the covered employee, death of the covered employee, the covered employee qualifying for Medicare, or losing your dependent status. Finally, the third provision is qualifying beneficiary, is refers to who else may continue their coverage. In almost all cases anyone who was covered can remain covered with COBRA insurance. Learn More

How Does it work? COBRA, contrary to popular belief, is actually not a health insurance plan all on its own. COBRA is actually the law that lets you keep the insurance you had. With COBRA you can choose to keep the insurance you had with your employer for up to 18 months in most cases if you qualify. However the major downside to this is that you are responsible for paying the entire premium. On average this is over $1000 monthly for a family of four. If you do choose to sign up for COBRA than you will have the exact same plan - same doctors, same hospitals, same prescription costs, same copayments, everything. Learn More

What if I can't afford COBRA? Since COBRA insurance requires that you pay the entire premium plus a 2% administration fee, many people simply can't afford it. This isn't surprisingly given most people considering COBRA just lost their jobs. If you find you can't afford COBRA then you should consider private health insurance plans. Many people find they can save over 65% with a private plan. If you can not afford a private health insurance plan than you can look into free community and government sponsored coverage. Learn More

This website is dedicated to helping individuals and families navigate the tricky waters of COBRA insurance. We strive to provide easy to understand information that can help you make smart decisions about your health insurance future. Between federal COBRA, state COBRA, private medical plans, and more, we know just how challenging this process can be and are here to help.