Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), employees and their dependents who lose their employer-sponsored health insurance benefits can still be eligible for coverage on certain group health insurance plans. However, there has been some concern among employers and their workers about the continuation of COBRA now that the Affordable Care Act (ACA) is in effect and people can receive healthcare coverage on the federal and state marketplaces.
COBRA will continue under the ACA, and the two laws can complement each other in certain instances. For instance, if a worker's insurance through COBRA ends during an open enrollment period, he or she can purchase a plan on one of the exchanges. To keep COBRA updated, the government recently released information on COBRA and the marketplaces and numerous new models for COBRA notices.
Guidance on COBRA and the marketplaces
The Department of Labor issued guidance on how those without continuing COBRA coverage can find healthcare plans on the ACA marketplaces. Kaiser Health News noted in a Q&A that people whose COBRA coverage is expiring have special enrollment options in the exchanges to receive coverage. However, to receive benefits on the marketplaces, those who had been enrolled in COBRA coverage need to sign up for plans within 60 days of the event.
New information on notices
According to the Society for Human Resource Management, there are a couple new notices employers should take note of. These are:
- The model general notice form, which gives workers information on their COBRA rights and obligations
- The model election notice form, which provides continuation of coverage rights and how the person and any covered dependents can make a qualifying election
COBRA has some additional notices that have not been updated at this time.
Lexology noted employers should consider reviewing their existing COBRA procedures and update their methods when necessary. Ensuring compliance with government guidelines will be important for employers in regards to workforce management.
"In many cases, workers eligible for COBRA continuation coverage can save significant sums of money by instead purchasing health insurance through the Marketplace," said Phyllis C. Borzi, assistant secretary of labor for employee benefits security at DOL. "COBRA continues to play an important role in helping workers and families maintain coverage after a job loss, and it is important that workers know that in some cases there is a Marketplace option as well."