What Is COBRA and How Does It Relate to Health Insurance Coverage?
COBRA is a federal law that generally provides that workers whose employment loss would result in a loss of group health insurance benefits have the right to continue their health insurance coverage under the group health insurance plan for up to 18 months. Generally, the terminated employee pays the employer or the plan 102 percent of the actual premium. Since the cost of COBRA continuation coverage is typically much more than the amount the employee pays, many view the cost of COBRA as cost prohibitive. The result is that very few terminating employees have the financial wherewithal to elect COBRA and continue their health insurance coverage. While COBRA applies to employers with 20 or more employees, many states have what is often called Mini-COBRA laws, which mirror the federal law in some way. The new subsidy under ARRA applies to both plans covered under COBRA and also those covered by state Mini-COBRA. What Is the COBRA Health Insurance Subsidy Provided by ARRA? “Assistance elig
