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What is COBRA Insurance?
COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that allows individuals who lose their employer-sponsored health insurance coverage to continue receiving that coverage for a limited period of time.
Under COBRA, individuals can choose to continue the same group health insurance plan that they had through their former employer, typically for up to 18 or 36 months, depending on the circumstances.
How Does COBRA Insurance Work?
Here’s how COBRA insurance works:
Qualifying event: COBRA coverage is available to individuals who have lost their employer-sponsored health insurance coverage due to a qualifying event, such as the loss of a job or reduction in hours.
Notification: Employers are required to notify employees who are eligible for COBRA coverage within 14 days of the qualifying event. Individuals have 60 days from the date of the notification to elect COBRA coverage.
Enroll in COBRA: If an individual elects COBRA coverage, they will be responsible for paying the full premium for their health insurance coverage, including the portion previously paid by their employer, as well as any administrative fees. They will have the same health insurance coverage they had before the qualifying event, typically for up to 18 or 36 months depending on the circumstances.
Maintain coverage: To maintain COBRA coverage, individuals must pay their premiums on time.
Explore other options: While COBRA can provide continuity of coverage for individuals who have lost their employer-sponsored health insurance, it can be expensive. Individuals should explore other health insurance options, such as the Health Insurance Marketplace, private insurance providers, or Medicaid, to find more affordable coverage.
How Much is COBRA Insurance?
Under COBRA, you are entitled to continue the same health insurance coverage that you had through your employer for up to 18 or 36 months, depending on the circumstances. However, you will be responsible for paying the full premium for that coverage, which includes both your share of the premium and the portion that your employer was previously paying on your behalf.
On average, COBRA coverage can cost between $400 and $600 per month for an individual and between $1,000 and $1,800 per month for a family. However, costs can vary widely based on the specific plan and location.
Also, See: Cobra Continuation Coverage
