The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law that requires most employers sponsoring group health plans to offer temporary extension of health coverage under certain circumstances in which the coverage would otherwise end. This is called continuation coverage.
Through COBRA, employees and their eligible dependents may have the right to continuation coverage under the ATS group health insurance program at their own cost for a maximum period of 18 to 36 months (length of time dependent on the qualifying event) after a qualifying event that causes an individual to lose health coverage. Qualifying events are:
- The death of the covered employee;
- The termination of the employee;
- A reduction in the employee’s hours, so that the employee or dependent is ineligible for coverage;
- The divorce or legal separation of the covered employee and his or her spouse;
- For spouses and eligible dependents, the employee’s entitlement under Medicare; and
- A dependent child who ceases to be a dependent under the terms of the plan.
Employees or an eligible dependent must report a qualifying event to Human Resources within 60 days after the date the event occurs. COBRA continuation is limited to those employees and/or dependents under specific events such as when eligible to receive Medicare benefits.