Under federal and state law, employers that have a group health plan are required to offer their employees (and their dependents) the option of continuing their membership in the group plan at their own expense after they leave their job. This is known as "electing COBRA," and these employees are entitled to continue coverage for 18 months.
Events that qualify for continuation of coverage:
- Voluntary or involuntary termination of employment for any reason except gross misconduct - employee entitled to continuation.
- Death of a covered employee - spouse and dependent children entitled to continuation.
- Divorce or legal separation of a covered employee - spouse and dependent children entitled to continuation.
- Covered employee becomes eligible for Medicare - spouse and dependent children entitled to continuation. Loss of child coverage due to age - child entitled to continuation.
Federal COBRA law governs employers with 20 or more employees, while state “mini-COBRA” law governs employers with fewer than 20. The laws are identical.
