What you need to know about your Cobra Rights

COBRA, also known as the Consolidated Omnibus Budget Reconciliation Act, was created in 1985 in order to provide a better means of protecting individuals from past employers. This is one of the little known laws that was created a few decades ago but few people really know what it is all about. Because of the lack of knowledge about COBRA and what it can do for employees and their families, few people actually take advantage of the program.

COBRA was designed as a means of ensuring that more people in the United States are covered by medical insurance. Through the law, those companies that had 20 employees or more during the previous year, would have to offer up to those employees that they either terminated or let retire continued medical benefits. However, because it is generally something that the employee has to inquire about themselves, there aren’t a lot of people that even know about it, except at those substantially larger companies that are run by a fair and caring human resource department.

Essentially what COBRA allows for is once an employee leaves a company either on their own or through company action, they are given upwards of 60 days in order to file for a continuation of their medical insurance. After this 60 day period, they are no longer eligible to apply. But during the period, the ex employee is allowed to apply for this continuation and the employee is required to give them group health benefits, much like they would any other employee. However, the ex employee would be responsible for the membership fees and a small administrative fee as well. These costs however would be substantially cheaper still than actually purchasing the plan on their own.

Through the COBRA plan, ex employees are allowed to keep this coverage for 18 months or until they have new insurance provided through another employer, whichever comes first. This law also comes into plan in the event of an employee’s death, where the spouse would be able to claim the benefits of the group health coverage.

While there are very few people that actually know about the COBRA law or how to use it, it is definitely worth doing the research, especially if your new employee isn’t capable of providing you with the insurance that you need. Being able to use your old insurance for an additional 18 months is normally more than enough time to find a means of supplying your own insurance or obtaining it through your new company of employment. Just keep in mind that these are your rights as an employee, so take advantage of these rights, and don’t let a company push you around in regards to them.