What to Do When COBRA Insurance Ends | Guardian Direct

What to do when COBRA insurance ends: your options

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No one is prepared for any circumstance that makes you lose your insurance coverage.

Whether it’s losing a job, getting a last-minute job offer, divorce or even the death of a loved one, losing your insurance unexpectedly is stressful for you and your family. When unlikely events happen, being prepared to know what your options are can ensure that you and your family have the support they need. That’s where COBRA insurance comes in.

COBRA is more of a law than it is a type of health coverage. COBRA stands for the Consolidated Omnibus Budget Reconciliation Act and exists to help protect you and your family in case your employer-sponsored health benefits are lost.

Here’s what you need to know about COBRA insurance:

What is COBRA insurance?

COBRA allows many employees and their families to continue their health insurance when faced with serious life events like termination from a job, divorce or even switching jobs.

However, eligible COBRA participants must pay their health insurance premiums themselves, which can be up to 102%.

The COBRA act only provides health insurance plans that match your old plan from your employer. So if you had medical, dental and vision with your employer, your coverage will be the same through COBRA. But if you only had medical, then you would not qualify for dental and/or vision with COBRA.

Who’s covered under COBRA insurance?

To be eligible for COBRA, you must meet all three requirements:

  1. Your employer is legally obligated to provide COBRA

  2. You’re a qualified beneficiary

  3. A qualifying event has occurred

Employers are required to offer COBRA if they also offer employer-sponsored health insurance plans and have at least 20 full-time employees. The federal government, churches and some church organizations do not qualify for COBRA.

Qualifying events for employees include:

  • Termination of employment (“gross misconduct” excluded)

  • Reduction in hours of employment

Qualifying events for spouses and dependents include:

  • Termination of employment (“gross misconduct” excluded)

  • Reduction in hours of employment

  • Employee becomes entitled to Medicare

  • Divorce of spouse from employee

  • Death of employee

Qualifying events for dependents include:

  • Loss of dependent status under the employee’s plan

What do I need to know about COBRA?

COBRA has a time limit for how long your coverage lasts. Depending on the how and why of your qualifying event, your coverage can last either 18 or 36 months.

However, you may qualify for a continuation if you provide proof of disability from the Social Security Administration (SSA) within your first 60 days of coverage. Your COBRA continuation will usually last 29 months until you become eligible for Medicare.

Depending on your coverage time period, you’ll need to be prepared for the next steps when your COBRA coverage runs out.

What do I do when COBRA runs out?

It’s best to look into other opens before your COBRA insurance runs out. One place to start is the federal government’s Health Insurance Marketplace.

You can find Marketplace plans during the annual open enrollment period, or you may qualify to enroll during the Special Enrollment Period. The Special Enrollment Period for the Marketplace is open to those who are losing employer-based coverage. You’ll have 60 days to enroll in a health plan, even outside of the annual open enrollment period.

Other options include going on your spouse’s insurance plan, finding employment that offers group health coverage, purchasing your own individual policy, or finding out if you’re eligible for Medicaid.

Many aren’t aware that they’re eligible for Medicaid. If you’re still unemployed after your COBRA insurance runs out, you may meet the requirements for Medicaid, although the requirements will vary by state.

Another option is to go through HIPAA, the Health Insurance Portability and Accountability Act. HIPAA provides opportunities for broad-benefit, individual health insurance plans for those who lose their coverage due to their COBRA plan expiring.

If you qualify, it’s required that you enroll in this option before your COBRA coverage runs up.

Qualifications may include:

  • You continue your COBRA coverage until it ends, without switching to an individual plan.

  • You’ve had continuous health insurance for at least 18 months.

  • You sign up for individual coverage within 63 days of your COBRA coverage ending.


Brought to you by The Guardian Life Insurance Company of America (Guardian), New York, NY. Material discussed is meant for general illustration and/or informational purposes only and it is not to be construed as tax, legal, investment or medical advice.(exp.10/21)