COBRA stands for Consolidated Omnibus Budget Reconciliation Act, which was established in 1985. This act included a provision which allowed employees and their dependents to continue their existing health insurance coverage through their previous employer. This act allowed the terminated employee to temporarily continue their work-based plan until they found individual coverage or other employment.
COBRA applies to work-based health plans sponsored by employers with 20 or more employees. COBRA is a continuation of your existing policy which means that the cost is exactly the same. The difference is that your previous employer is not paying your portion anymore or subsidizing your premium amount. You are paying the full premium amount plus a 2% administrative fee.
COBRA coverage can last for 18 months to 36 months, depending on the reason for termination. For example, if you are the employee's spouse and lose coverage due to a divorce or legal separation, you are eligible for 36 months of COBRA. For a complete list of "qualifying events, " please call a Gizmo Health representative at 1-312-884-5150 or visit http://www.gizmohealth.com.
Friday, January 2, 2009
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