What is COBRA? COBRA is the ability for an employee/subscriber that no longer qualifies for insurance through a reduction in hours, over age, divorce/separation, terminated employment to continue coverage through their current policy for a limited amount of time.
Who needs to comply with COBRA?
Covered Employers
COBRA generally applies to all private sector group health plans maintained by employers that had 20 or more employees on more than 50% of their typical business days in the previous calendar year. This includes corporations, partnerships and tax-exempt organizations. COBRA also applies to plans sponsored by state and local governments.
Small Employer Exception
A group health plan is not subject to COBRA for a calendar year if the employer maintaining the plan normally employed fewer than 20 employees during the prior calendar year. Small employer plans are not subject to COBRA for the entire calendar year for which they qualify for this exception. COBRA also does not apply to group health plans maintained by churches. However, small employer plans may be required to provide continuation coverage under state insurance law (known as mini-COBRA laws).
