COBRA

COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that gives employees and their families who lose health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances.

Qualifying events that trigger COBRA rights include: voluntary or involuntary job loss, reduction in hours worked, transition between jobs, death, divorce, and other life events. COBRA applies to employers with 20 or more employees who offer group health coverage.

COBRA coverage can last 18 months for job loss or reduction in hours, and up to 36 months for other qualifying events. The cost of COBRA coverage is typically much higher than what employees paid while employed, because the employer no longer subsidizes the premium.