Cobra Health Insurance -- What You Need To Know

If you lose your job at any time, you ought to know that by law you are still permitted to maintain your group health coverage. If you were given a pink slip, resigned or if your hours have been reduced to part-time, its irrelevant.

Rights are guaranteed under COBRA. COBRA is short for Consolidated Omnibus Budget Reconciliation Act of 1986, is an amendment of the Employee Retirement Security Act. It gives one security once their group health plan has ended.

Regardless of why you have lost your job with the exception of gross misconduct, you are guaranteed the right to continue your employer's group plan for up to 18 months at your own expense. COBRA coverage is offered to spouses and dependent children for as long as three years.

If you continue your plan under COBRA, you can be charged 100 percent of the premiums plus a 2 percent administrative fee. The trouble with COBRA is that the greater part of people cannot afford to continue to pay for the premiums.

For the most part, people who are able to use COBRA, wind up opting for individual health insurance or short-term health insurance while waiting for a new job that provides health benefits. In order to qualify for COBRA a company must have employed a minimum of 20 workers at least half the year that are enrolled in a group plan. Eligibility for COBRA is dependent on qualifying events.

Certain events such as quitting a business and becoming jobless or self-employed, being a widow, widower or youngster of an worker who past on, divorced spouse or child of an employee who has left the business, or are the child of an employee and you have arrived at the plan's cut-off age. The law grants an exemption from COBRA continuation rules to federal employees, certain church-related organizations and firms employing fewer than 20 people.

The IRS rules state that employers must figure part-time workers into their employee total to determine if they can claim exemption. Some states have enacted "mini-COBRA" laws that apply to employers with 2 to 19 workers.

About the Author:
Start saving a lot here: Arizona Health Insurance and Arkansas Health Insurance

Mercy Gabriel-Odimba writes on financial matters.

Article Originally Published On: http://www.articlesnatch.com

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