COBRA Health Insurance and Divorce
Your Rights Under COBRA
C.O.B.R.A. stands for the Consolidated Omnibus Budget Reconciliation Act
of 1985. The Act was passed by Congress in 1986 and it requires certain
employers to provide, at group rates, continued health insurance coverage
for up to three years for
divorced persons, widows, spouses of retiring workers and their children. These benefits
must also be provided for workers and their dependents when the worker
is terminated (for reasons other than gross misconduct) or who has a reduction in hours.
Read below or see related topics:
spousal support and insurance,
insurance and separation,
insurance and child support
Are All Employees Affected By C.O.B.R.A.?
No. The Act affects employers who:
How Long Will Coverage Under C.O.B.R.A. Last?
- Have 20 or more employees; and
- Are not covered by governmental or church plans.
If you and your spouse are
, you can remain covered by your ex-spouse's employer for up to three
(3) years. Widows, spouses of retiring workers and children who are no
longer dependent can also be covered for up to three years.
What Kind Of Coverage Can I Obtain?
C.O.B.R.A. requires that employers offer identical coverage to C.O.B.R.A.
recipients as is provided to any other beneficiary. If the plan "core"
or "basic" coverage and also options that may be added (such
as dental coverage), you may elect to receive only the core coverage,
or as many additional benefits as you wish.
How Do I Get Coverage Under C.O.B.R.A.?
If you and your spouse are divorcing, and your spouse is employed by a
company that is affected by C.O.B.R.A., you are a "qualified beneficiary."
It is your spouse's responsibility to notify the plan administrator
of your divorce within 60 days of the date of the final
. Once you have notified the plan administrator, the company has 14 days
to send you information describing your rights under C.O.B.R.A.. You will
then have 60 days to decide if you want to be covered under C.O.B.R.A..
Other qualified beneficiaries include dependent children, spouses of retiring
employees and widows of previous employees. All qualified beneficiaries
are subject to the same rules.
The employer will no longer pay your premiums once you elect C.O.B.R.A..
You or your ex-spouse will have to pay these premiums and this may as
well have an affect on how much coverage you want beyond the basic or
core coverage. The employer will charge you the same group rate that an
employee must pay. However, a maximum surcharge of two percent can be
charged to you by the company for administrative costs. The employer also
has to allow you to pay the premium in monthly installments if you would like.
Is There Any Way That My Coverage Can Terminate Before The Three Years?
Yes. In the following circumstances, your coverage would terminate:
- If the employer should decide not to offer a group health plan to any employee;
- If you or your ex-spouse fail to pay your premium;
- If your ex-spouse gets another job; or
- If you become eligible for Medicare or certain Social Security benefits.
If I Remarry Will I Lose My C.O.B.R.A. Health Insurance?
It depends. If you remarry but do not receive coverage under your new
spouse's group health plan, you may retain your C.O.B.R.A. coverage.
To lose your C.O.B.R.A. coverage you must remarry and become covered under
another group plan.
Are There Any Special Conditions That Might Exclude Me From Coverage?
Usually not. In most cases, you are not required to have a physical exam.
If your deductible has been met for that year, it will carry over to your
separate policy. Also, you will not lose coverage because of preexisting
conditions. This means that any ongoing illness or condition you have
that was covered prior to divorce will still be covered by your policy
Montgomery Family Law is seasoned in the application of North Carolina
Contact us today for assistance with your divorce.