What Is COBRA?

When people find out they have chronic kidney disease (CKD), many may begin to worry about their health and how they will pay for it. In uncertain times, you may find that you need COBRA to help cover your health care costs. COBRA is continuation of health insurance, usually for people who are laid off, fired from their job or have other life changing events and lose their employer's health care coverage. COBRA may be available to help people from the time a person or their spouse loses their job until they get back on their feet. This is a look at what COBRA is, how it works and who is eligible for this type of continuation coverage.

How COBRA works

COBRA (Consolidated Omnibus Reconciliation Act of 1985), also known as "continuation of coverage," is a federal law that applies to employers and group health plans that cover 20 or more employees. It allows you, the employee and or covered dependants, to continue with your health coverage for a set amount of time if coverage would otherwise be lost due to a life event change, usually referred to as a qualifying event. Employers may require people who elect continuation of coverage to pay the full cost of the coverage, plus a 2 percent administrative charge. Remember, many chronic kidney disease patients are dependants and entitled to COBRA, whether their spouse (the former employee) elects COBRA for themselves or not.

What is a qualifying event

When you are the employee, a qualifying event is a loss of employer health insurance due to:

  • Voluntary or involuntary termination (laid off or fired) of employment, for reasons which aren't related to gross misconduct
  • Reduction in the hours of a covered employee

When you are the spouse or dependant, a qualifying event is a loss of employer health insurance due to:

  • Voluntary or involuntary termination of employment of the covered employee's employment, for reasons not related to gross misconduct
  • Reduction in work hours of a covered employee
  • Divorce or legal separation from a covered employee (within 60 days of the event)
  • A covered employee becomes entitled to Medicare
  • Death of the covered employee
  • A child's loss of "dependant child status" as defined under the plan

Who can enroll?

You may be able to receive COBRA if you have health insurance through an employer who has 20 or more employees, and there is a qualifying event. In some states you may be able to qualify for a Mini COBRA if you have health insurance through an employer who has 2 to 19 employees, and there is a qualifying event.

How much does COBRA cost?

COBRA premiums can seem expensive at first glance. Organizations like the American Kidney Fund (AKF) and some government programs can help assist in paying for health care costs. Please note that the AKF assists people with chronic kidney disease who are on dialysis or are getting ready to go on dialysis. Talk with your social worker immediately if there is any change in your family's insurance or employment. The social worker can help maintain health care coverage.

How long can I keep my COBRA coverage?

As of July 2009, COBRA requires that continuation of coverage be made available for a limited period of time - 18 to 36 months - depending on the type of qualifying event as follows:

  • 18 months - for covered employees and their dependants when termination of employment or reduction of work hours has occurred
  • 36 months - for dependant spouses when divorce or legal separation occurs, death of covered employee or loss coverage due to covered employee becoming entitled to Medicare
  • 36 months - for a child dependant who has loss of "dependant child status" as defined under the plan

COBRA extensions

You may be able to extend your coverage beyond the 18-month period of continued coverage if:

  • Any covered beneficiary is deemed disabled by the Social Security administration and the COBRA administrator is notified of such disability within 60 days of the event and before the end of the 18-month coverage period. This would grant an additional 11 months, equaling 29 months of total coverage. However, the plan can charge up to 150 percent of the cost of coverage, for coverage during the 11-month extension.

When and how does my COBRA coverage end?

Your coverage will end after the 18-month period ends if a social security disability extension has not been obtained or at the end of 29 months if the disability extension was approved by the COBRA administrator. COBRA can end prior to the predetermined duration if:

  • Premiums were not paid on time.
  • Your former employer fails to maintain any group health plan for active employees.
  • You or a beneficiary becomes entitled to Medicare after you elect for COBRA.
  • You receive coverage with another employer group health plan.

Can I continue my insurance after my COBRA ends?

In some instances you may have several choices, including:

Important dates and deadlines to remember

The following are dates that you should keep in mind if you are looking into COBRA for insurance coverage:

  • Your employer has 30 days after a qualifying event to notify you about COBRA and send you a COBRA election form. In some cases an employer is not required to notify you about COBRA, so it is best to inquire with your employer or group health plan.
  • You have 60 days from the date of your election paperwork to elect your COBRA benefits.
  • You have 45 days from the date you elected (signed) the COBRA paperwork to make the first payment. Failure to do so will result in the COBRA being terminated with little or no chance of reinstatement.
  • If you do not receive your notification in the mail, contact your employer or health plans as soon as possible.
  • Call the Department of Managed Care for your State if you are having problems obtaining these forms.

Tips to obtaining and maintaining continued coverage

  • Send in the election (application) form before the end of the deadline, 60 days from date on form.
  • Send it to the correct address.
  • Make sure the correct premium amount is sent before the end of the 45 days required to make the first payment.
  • Continue with timely monthly payments as some COBRA administrators will not send monthly invoices or reminder of payment.

Summary

When you discover you have chronic kidney disease, you will want to know what your options are in regards to maintaining and covering your health. Changes may occur throughout your life, and certain times call for COBRA as an option for continuation of health insurance coverage.


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