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COBRA Health Insurance Laws

Posted on: June 13th, 2012 by Cobra Insurance Guide

Many of the questions we receive on a daily basis are regarding the current COBRA health insurance laws and how they affect people who have been laid off, quit their job, or retired from their job. The COBRA insurance laws have actually not changed much since they were passed in 1986 and still serve the same purpose to protect individuals and families from suddenly being without health insurance.

Under the COBRA health insurance laws people who lose, quit, or retire from their job without the presence of gross misconduct AND who meet certain government requirements can elect to continue the exact same health insurance plan with COBRA. This benefit extends to their family members as well. However the main difficulty for most people with the COBRA laws are that you are required to pay the entire cost of the health insurance plan. Since most employers pay anywhere between 50%-90% of the cost, this is a significant expense especially for someone who has just lost their job.

The three conditions that the government sets out in the law are known as qualifying plan, qualifying event, and qualifying beneficiaries. Qualifying plan refers to the type of health insurance plan the person had when they had a job. In most cases any plan that covered 20 full time employees will be eligible for federal COBRA laws. The second requirement, qualifying event, is how the person lost their insurance coverage. For employees this can be quitting, retiring, or losing their job without gross misconduct. For family members this could be that the covered employee lost, quit, or retired from their job, due to a legal separation or divorce, or because a dependent loses their dependent status. The final requirement, qualifying beneficiaries, is who else is eligible for coverage. In most cases anyone who was covered under the health plan can continued to be covered with COBRA insurance laws.

Am I able to stay on my ex’s health insurance plan after we get divorced?

Posted on: June 11th, 2012 by Cobra Insurance Guide

Doctor

Anyone going through a divorce knows just how tricky it can be to navigate the waters. Not only is there substantial emotional difficulty regarding divorce but on top of that is all the legal, financial, and healthcare decisions that emerge. One of the most common questions we here is, “Can I stay on my ex’s health insurance plan after divorce?” The answer to this question is actually Yes and No.

Let’s start with the Yes. If you ex was on a health insurance plan that covered at least 20 full time employees, then you likely can elect COBRA insurance and keep your ex spouses’ plan for up to 36 months in most cases. Divorce is considered a qualifying event under COBRA so you have the right to sign up. The tricky side of COBRA though is that you are required to pay the entire premium, which is usually between 50-90% higher than what you are used to.

Now onto the No. COBRA insurance is only a temporary solution to health insurance after divorce. Not only will it run out at some point, it is extremely expensive. Moreover if you develop a condition while on COBRA it may disqualify you from future health insurance policies. Your best bet is to get your own health insurance as soon as possible. This can be done through your employer if available. If not, look into private health insurance. It can be surprisingly affordable. You can begin looking for private health insurance by getting free quotes and comparing plans.

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