Administrative Services
COBRA
Frequently Asked Questions
The following questions and answers are provided as general information, enabling an individual to better understand the specifics regarding COBRA coverage.
Who can qualify for COBRA?
How long does COBRA coverage continue?
What is a second qualifying event?
When will my continuation end?
How do I elect coverage?
What are the payment requirements?
Can the plan and/or rate change during continuation?
What is the disability extension?
Can I add coverage for newly acquired dependents?
What is core vs. non-core benefit coverage?
Can I have other group health coverage or Medicare?
Does a pre-existing condition limitation apply to COBRA coverage?
Are there any other options available besides COBRA?
- An employee and his/her dependents who would lose health coverage due to a reduction in work hours or a termination of employment, excluding gross misconduct
- An employee’s former spouse (and/or children) who would lose coverage due to divorce or separation
- An employee’s surviving spouse (and/or children) in the event of the employee’s death
- An employee’s spouse (and/or children) should an employee be entitled to Medicare
- An employee’s child who no longer meets the definition of dependent (i.e., attainment of maximum age unless a full-time student meeting certain age requirements)
How long does COBRA coverage continue?
For individuals who have experienced termination of employment, the maximum continuation period is 18 months from the qualifying event date.
For qualified dependents involved in a divorce or separation or who have been widowed or lost coverage based on Medicare, the maximum continuation period is 36 months from the qualifying event date.
What is a second qualifying event?
If a dependent loses coverage due to an employee qualifying event and then experiences another event causing him/her to lose coverage again, he/she may be able to continue for 36 months dating from the beginning of the original qualifying event. Requests must be sent to HM Benefits Administrators (HMBA) within 60 days after the occurrence of the second qualifying event.
When will my continuation end?
Continuation ends when:
- Qualified person becomes covered by Medicare after the date of COBRA election
- Qualified person becomes covered by another group health plan that does not contain a pre-existing condition limitation or exclusion or for which such a condition limitation does not apply because there has been enough previous coverage to satisfy the new plan’s limitation period
- Premium is not paid timely or in full
- The employer’s group health plan is terminated (though continuation may be completed under a replacement plan)
- The end of the maximum continuation period is reached.
How do I elect coverage?
Complete HM Benefits Administrators' Continuation Election form within 60 days of the date of the notice or 60 days from the date of termination of coverage. If you mail after this deadline, continuation will be denied.
What are the payment requirements?
You are required to pay the entire cost for the continued coverage and an additional two percent administrative fee allowed by COBRA (for disabled and other continuees eligible for the 11 month extension, rates can be charged up to 150% of the total cost during the extension).
COBRA continuees have 45 days from the date of election to remit the first premium. Coverage will not be reinstated until receipt and processing of the initial premium. Initial premium mailed after the 45th day will not be accepted, and the right to continued coverage will be forfeited.
Once the initial premium payment is processed, bills will be mailed monthly. Premium payments must be made monthly and are due on the first of each coverage month. Payment must be made regardless of whether a bill is received or not. Delinquency notices will not be sent.
Can the plan and/or rate change during continuation?
Your continued coverage is subject to the same rate and benefit changes as active members under the company medical benefit plan. Your billing statement will reflect any group health plan rate changes when applicable. If rates change retroactively, you will be obligated to pay any premium differences that have become due.
What is the Disability extension?
A qualified person(s) whom the Social Security Administration determines to have been disabled prior to or within the first 60 days following a qualifying event can request an 11 month extension of continuation. This extension applies to all qualified beneficiaries. The disabled individual can be a covered employee or any other qualified beneficiary in the family. Rates can be charged up to 150% of the total cost during the extension.
Can I add coverage for newly acquired dependents?
Any qualified person may elect coverage for a newly acquired dependent (i.e., spouse, newborn child, etc.). The COBRA continuee must notify HM Benefits Administrators in writing to add coverage for the newly acquired dependent(s) within the same time period that applies to newly acquired dependents of active employees.
What is core vs. non-core benefit coverage?
Core benefits are defined as all group health benefits other than dental care and vision care. Non-core means dental care and vision care.
If a qualified person is covered for both core and non-core benefits on the day before a qualifying event, that person may elect continuation of core plus non-core benefits, core benefits only or non-core benefits only. Non-core benefits only can be elected if allowable under the active plan.
Can I have other group health coverage or Medicare?
You can have other group health coverage or Medicare (Part A and/or B) if the other coverage was in effect prior to your COBRA election date. Your continuation coverage may terminate early if you, your spouse or dependent child(ren) become covered after the date of your COBRA election under another group health plan that does not contain any exclusion or limitation for any of your pre-existing conditions or Medicare benefits.
Does a pre-existing condition limitation apply to COBRA coverage?
For plan years beginning after June 30, 1997, employers must limit their pre-existing exclusion period to no more than 12 months (18 months for a late entrant). A plan’s pre-existing condition exclusion period will be reduced by each month that you and your family had continuous health coverage (including COBRA continuation coverage) with no break in coverage greater than 63 days. If your COBRA coverage ended after June 1, 1997, you will receive certification of the duration of your COBRA coverage. This certification, along with your certification of coverage while an active employee, can be used by your new plan to determine how much time, if any, is left for you to satisfy the pre-existing condition limitation.
Are there any other options available besides COBRA?
Many states have continuation laws. Conversion is also usually an option. In some states, if you elect state continuation or conversion, you may not elect COBRA.
