What is COBRA?

The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) is a law that allows you and your covered dependents to continue your employer-sponsored group health and dental coverage under certain circumstances when coverage would have otherwise ended.

Covered employees and their covered dependents will be notified of their right to elect to continue coverage. The person electing to continue coverage under the employer’s group plan will be responsible for paying 100% of the monthly premium.

If My Assignment Ends, When Will My Coverage End?

• On the last day of the month in which an employee has ended an assignment, is terminated, or voluntarily terminates employment
• On the last day of the last fully paid month, if an employee fails to pay his/her portion of the monthly premium.

The following guidelines will determine the effective date of COBRA coverage and the premium payments due while an employee is between assignments:

• Monthly premium payments are paid in advance via payroll deduction from the last paycheck of each month. Therefore, coverage will remain in effect to the end of the month even if an assignment ends in the middle of the month.
• If an employee has a break between assignments under 60 days, the employee will remain on the health plan with no break in coverage, as long as employee’s portion of premium is caught up once back on assignment. 
• If the employee does not return to work within 60 days, the employee will have the option to continue coverage under COBRA.

Example
Jane Doe’s assignment ends September 7. Her September premium was paid via payroll deduction from the last paycheck in August and will end September 30.  She will be offered COBRA effective October 1.  In the meantime, if she begins a new assignment within 60 days (before November 7), her health coverage will continue with no break in service, as long as her portion of the premiums are caught up when she returns to work.

COBRA Monthly Premiums:

Important Note About the HSA

Health Savings Accounts (HSA) are not eligible for contributions under COBRA.  However, BTHR BeneTemps will keep an employee’s HSA open for a period of six months after assignment has ended.  During that time, the employee will be able to use any funds left in their HSA for medical and dental expenses. Other HSA options will be communicated via email.

Group Health Eligibility Upon Rehire

Upon returning to active assignment, employees who had previously elected coverage through COBRA while they were off-assignment, will immediately return to active status in the group health plan. The employee will pay the monthly premium at the 50% split rate.

Employees who do NOT continue coverage through COBRA and have a break between assignments or separation from BTHR BeneTemps for longer than 60 days, must satisfy a new 90-day waiting period and accrue 390 hours to be eligible for the group health plan.

Important Note About the Affordable Care Act

There may be other coverage options for you and your family through the Health Insurance Marketplace.  In the Marketplace, you could be eligible for a new kind of tax credit that lowers your monthly premiums right away, and you can see what your premium, deductibles, and out-of-pocket costs will be before you make a decision to enroll.

Being eligible for COBRA does not limit your eligibility for coverage for a tax credit through the Marketplace. Additionally, you may qualify for a special enrollment opportunity for another group health plan for which you are eligible (such as a spouse’s plan), even if the plan generally does not accept late enrollees, if you request enrollment within 30 days.

For more information about health insurance options available through a Health Insurance Marketplace, visit www.healthcare.gov.