Very simply, COBRA is the continuation of the exact health insurance coverage you had at your employer. The cost of COBRA can be no more than 2% higher than what it costs your employer. So why is COBRA coverage so expensive?
- Very simply, because that’s what it costs. What you are paying is your portion of the premium PLUS your employers portion and possibly an additional 2% for administrative costs.
Here’s some quick Q&A regarding COBRA. Note, as with any government program there are exceptions to the general rule, so extra investigation may be warranted if you feel your situation may be an exception.
How long do you have to elect Cobra?
In most cases 60 days from either the loss of coverage of the date the COBRA election notice is provided by the employer or plan adminstrator, whichever is later. IMPORTANT: COBRA coverage must be continuous, so even if you wait until “day 60” you will be responsible for back premiums.
Does everyone who is eligible for COBRA have to accept (i.e. all or none)?
No, COBRA coverage can be elected by each person (parents determine coverage for minors)
How long does COBRA coverage last?
In most cases COBRA coverage lasts 18 months and then it terminates. There are exceptions for disability where coverage can be extended.
This is just the tip of the iceberg on the ins and outs of COBRA. The main point I want to get across is that COBRA, if elected, is an extension of the exact same coverage you had with your employer.