COBRA: Continuation of Health Coverage Explained
Who is covered by COBRA
COBRA applies to group health plans of employers with 20 or more employees on a typical business day in the prior year. Many states have 'mini-COBRA' laws covering smaller employers.
Qualifying events
COBRA is triggered by events that would otherwise end coverage, such as:
- Voluntary or involuntary job loss (except gross misconduct)
- Reduction in hours below plan eligibility
- Divorce or legal separation
- Death of the covered employee
- A dependent aging out of the plan
Coverage period and cost
COBRA coverage usually lasts 18 months (up to 36 in some cases). The individual pays the full premium plus up to a 2% administrative fee — often a surprise compared to the subsidized employee rate.
Employer obligations
Employers must provide an initial COBRA notice and an election notice within strict timelines after a qualifying event. Missing notices creates real liability.
Related terms
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Which employers must offer COBRA?
Generally those with 20 or more employees. Smaller employers may be covered by state 'mini-COBRA' laws.
How long does COBRA last?
Typically 18 months, extending to 29 or 36 months for certain qualifying events.
Who pays for COBRA coverage?
The individual pays the full premium plus up to a 2% administrative fee.
How does MyCo help with COBRA?
MyCo flags qualifying events and helps you issue required COBRA notices on time so you stay compliant.