COBRA Has Not Been Eliminated

By Fritz Teutsch
President BASIC

October 1, 2013 – COBRA has not been eliminated under Health Reform. All the same rules and regulations continue for health plans including those for vision and dental. On May 8, 2013 the Department of Labor (DOL) issued a revised model notice which added additional language to the qualifying event notice. This was intended to inform individuals of additional options with guaranteed issue health insurance policies provided through the public marketplace/exchange. For those who qualify, they could be eligible for a subsidy.

Although Health Reform offers an alternative to COBRA though the marketplace/exchange, many other provisions of PPACA have a direct impact on COBRA. As an example, PPACA extended coverage for dependent covered children to age 26. When the coverage ends, employers subject to COBRA must extend the offer of COBRA to those children to allow coverage to age 29. Some of the other provisions that impact COBRA include the appeals process, lifetime limits, and the stability period.

Even with the marketplace/exchange option, COBRA could be better. You know your current health plan, deductibles, co-pays, and co-insurance and it may be hard to find a match in the marketplace/exchange. Rates could be higher too. It’s important to review if you have met your deductible, co-insurance or max out of pocket, otherwise, you could be starting over. There is more to consider than a subsidy and that’s a good reason why COBRA is here to stay.