Unemployed? Here’s What to Know About COBRA

If you have recently quit a job or have been fired, you may have the right to continue your health insurance through a Federal law named COBRA. This stands for the Consolidated Omnibus Reconciliation Act and has existed since 1985 with revisions to the program made in 1999. Here’s some good and bad news about COBRA.


The good news is you have the right to continue your health insurance for 18 months if you quit or are fired from a job or have your hours reduced to a point where you lose employer-paid health coverage. Note: you cannot be covered if your firing occurred because of “gross misconduct”.

Coverage can occur up to three years for other reasons:

  • Death of a spouse who was the covered employee
  • A child turns 26 years of age and cannot stay on a parent’s insurance
  • A divorce or separation from a covered employee
  • The covered employee becomes eligible for Medicare

The bad news is you have to pay the entire cost of the insurance plus up to a 2% administration fee. The costs may be more than you can afford, particularly if your budget had not included medical insurance premiums because your family was covered by an employer’s plan. COBRA is only offered to employees who work for companies with 20 or more employees or who work for state or local governments.

Once you or your covered family member leaves a covered job, the employer must notify the insurance company within 30 days if you quit, are fired, become eligible for Medicare, or die. You have the responsibility to notify the employer’s health insurance company for a divorce, legal separation, or loss of a child’s coverage due to age. The health insurance company then has 14 days to inform you of COBRA coverage, and you have a 60-day window to decide whether to accept it. Your spouse and children can choose separately if you decide not to use COBRA coverage, and you can change your mind again within the 60 days.

COBRA insurance coverage can be a complex subject, but First Day Films can help simplify it with our employee benefits videos. We can create training and education videos for a wide range of employee benefits and human resources topics including COBRA. For more information on video services from First Day Films please call 833-422-7332.

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