Losing your job can be stressful, especially when it comes to keeping your health insurance.
COBRA insurance offers a way to stay covered after leaving your job. COBRA coverage lets you keep your employer’s health plan for up to 18 months after you stop working there.
alt=”A person sitting at a desk, filling out paperwork with a laptop open, while a phone with a COBRA Insurance number sits nearby”>
Signing up for COBRA isn’t hard, but you need to act fast.
You only have 60 days to decide after you get your COBRA election notice.
This notice comes from your old job’s health plan after you leave.
It tells you how much you’ll pay and what benefits you’ll get.
COBRA can be pricey since you pay the full cost of the plan.
But it lets you keep the same doctors and benefits you had before.
This can be a big help while you look for a new job or find other health insurance.
Key Takeaways
- COBRA lets you keep your work health plan after leaving your job
- You have 60 days to sign up after getting your COBRA notice
- COBRA can be costly but keeps your same doctors and benefits
Understanding COBRA Insurance
COBRA insurance helps people keep their health coverage after leaving a job.
It’s a short-term option that can be costly but provides peace of mind during transitions.
What is COBRA?
COBRA stands for the Consolidated Omnibus Budget Reconciliation Act.
It’s a law that lets workers and their families keep their group health insurance for a limited time after job loss or other qualifying events.
COBRA isn’t a new insurance plan.
It’s the same coverage you had at work, but now you pay the full cost.
This includes the part your employer used to pay, plus a small fee.
The coverage usually lasts 18 months, but it can go up to 36 months in some cases.
It’s meant to be a bridge until you find new insurance.
Eligibility and Qualifying Events
To get COBRA, you need to have been in a group health plan and have a qualifying event.
These events include:
- Job loss (unless fired for gross misconduct)
- Reduced work hours
- Death of the covered employee
- Divorce or legal separation
- A child no longer being a dependent
You have 60 days to choose COBRA after your regular coverage ends.
If you don’t pick it in that time, you lose the chance.
COBRA applies to companies with 20 or more employees.
Some states have similar laws for smaller businesses.
Comparing COBRA with Marketplace Plans and Medicaid
COBRA keeps your old plan, but it can be pricey.
Other options might be cheaper or better for your needs.
Marketplace plans under the Affordable Care Act (ACA) often cost less than COBRA.
You might even get help paying for them based on your income.
Medicaid and the Children’s Health Insurance Program (CHIP) are low-cost or free options for those who qualify.
They’re based on income and family size.
COBRA lets you keep your doctors and current care.
But marketplace plans or Medicaid might offer similar coverage at a lower cost.
It’s smart to compare all your choices before deciding.
Signing Up for COBRA Insurance
COBRA insurance lets you keep your health coverage after leaving a job.
The process involves a few key steps and decisions about costs and managing your plan.
The Enrollment Process
When you leave your job, your employer will tell the health plan.
The plan then sends you an election notice.
You have 60 days to decide if you want COBRA.
This is called the enrollment period.
To sign up, you need to fill out forms.
These forms ask for info like your name and which family members you want to cover.
Send the forms back before the 60 days are up.
If you miss the deadline, you might lose your chance to get COBRA.
But sometimes you can get more time.
This is called a special enrollment period.
It can happen if you have big life changes.
COBRA Costs and Premiums
COBRA can be pricey, so you need to know what to expect.
You pay the full cost of your old plan, plus a small fee.
Your old job won’t chip in anymore.
The exact cost depends on your old plan.
It’s usually the group rate plus 2% for admin fees.
You can use money from a health savings account to pay for COBRA.
You’ll need to pay on time each month.
If you’re late, you could lose your coverage.
Some plans give a grace period, but don’t count on it.
Managing Your COBRA Coverage
COBRA usually lasts 18 months.
But it can go up to 36 months in some cases.
During this time, you can make changes to your plan.
You can add or drop family members during open enrollment.
This happens once a year.
You might also be able to switch plans if your old job offers different options.
Keep an eye out for letters from your COBRA admin.
They’ll send info about changes to your plan or costs.
If you find a new job with health insurance, you can drop COBRA anytime.
Frequently Asked Questions
Getting COBRA coverage can be confusing.
Here are answers to some common questions about how to sign up, what it costs, and when coverage starts.
What steps should I follow to initiate COBRA coverage?
To start COBRA coverage, wait for an election notice from your health plan.
You’ll get this after a qualifying event like losing your job.
Once you get the notice, you have 60 days to decide.
If you want COBRA, fill out the form and send it back.
Can I sign up for COBRA insurance online, and if so, how?
Some companies let you sign up for COBRA online.
Check the election notice for instructions.
If online signup is available, you’ll get a link and login info.
Otherwise, you’ll need to mail or fax the form back.
What’s the deal with how COBRA insurance actually operates?
COBRA lets you keep your old work health plan for a while.
It’s the same coverage you had before.
You can see the same doctors and use the same benefits.
The main difference is you pay the full cost now.
What are the costs I can expect to pay monthly for COBRA coverage?
COBRA costs more than employer insurance.
You pay the full premium plus a 2% fee.
The exact amount depends on your old plan.
It could be hundreds or over $1,000 per month for family coverage.
Is there a waiting period before my COBRA coverage kicks in?
There’s no waiting period for COBRA.
Coverage starts the day after your work insurance ends.
But you have to elect COBRA and pay the premium.
If you do this, there won’t be a gap in your coverage.
After leaving your job, you need to sign up for COBRA.
Your employer will tell the health plan that you left.
The plan will then send you an election notice with info on how to sign up.
You have 60 days to decide.
If you want COBRA, send back the form and pay the premium.