COBRA Divorce Rules - Keep COBRA Insurance When Divorcing

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While undoing all those “I Dos”, you need to understand and apply your rights under the Consolidated Omnibus Budget Reconciliation Act of 1986 known as COBRA.

By following the COBRA guidelines and acting within the time periods allowed under the law to elect your coverage, you can remain covered under your ex-spouse’s group medical plan with the same benefits that you had before.

In general terms, most group medical plans are required to provide continuation coverage for private employers maintaining plans that normally employ 20 or more employees on a typical business day during the preceding calendar year.

Continuation coverage must be provided if, on the day before the event, you are a beneficiary under a group health plan.

Be aware, however, that domestic partners are not qualified beneficiaries although many plans voluntarily provide continuation coverage to domestic partners. Check out the SPD (Summary Plan Description) to see if your Domestic Partner's group medical plan offers coverage under COBRA divorce rules.

The law sets the minimum standard of coverage. Employers are free to offer greater benefits than required by the law.

Timely notification of a qualifying event under COBRA law is essential to preserve your continuation rights under a former spouse’s plan.

Notify the plan administrator within 60 days after the date of the divorce or legal separation. This is not the day you and your spouse first decide to get a divorce. In fact, the correct period to mail a notice is often many months after you file for a divorce, so timing is everything.

Awareness of the rules and knowing when to act is the difference between keeping or losing your right to COBRA Continuation Coverage under the COBRA Divorce provisions.

A plan administrator, once notified, has 14 days to alert you and your family members –in person or by first-class mail- about your right to elect COBRA.

Keep in mind, however, that because COBRA is considered a burden to administer by many employers, declining coverage to an otherwise qualified beneficiary who failed to elect coverage within the election period is a legal “out clause” that an employer may look to take advantage of and not provide the COBRA extension.

The beneficiary spouse, after receiving a COBRA Election Notice which describes their rights to continue coverage, must have at least 60 days from the later of the qualifying event, date coverage was lost or the date of the COBRA notice to elect extended coverage.

Here again you must remember that most employers will hire a COBRA administrator to get you off COBRA as opposed to keeping you on COBRA.

Since the election period runs from the date of the notice, it is important to guard against the possibility of a misdirected COBRA notice.

Qualified beneficiaries should be sure that the COBRA administrator, not always the former employer, has a current address for the COBRA participant and beneficiaries and that the postal mailing information is kept up to date. Use certified mail with delivery confirmation to protect your rights.

The provisions of the law allow the employer to pass on the full group medical cost of providing continuation coverage to the COBRA participant, including a 2-percent charge for administration. So, if the full cost of coverage that the employer pays is $400, then your bill will be $408 per month.

Finally, even if you know and you have complied with all of the rules, and completed your paperwork correctly, you still can be foiled in your efforts to remain on the plan by a misinformed or vengeful spouse.

Having an expert COBRA advocate on your side of the table, working for you, to ensure compliance and enrollment into the COBRA continuation plan, can often be the difference in getting coverage or not.

Successfully transitioning onto the COBRA plan is even more important when you have a pre-existing condition. Fortunately, once enrolled, you may stay on the plan for as long as 36 months.

COBRA divorce provisions will assure continuity of your healthcare during a time when your physical and mental health will be strained. Stress is linked to a host of medical problems. Access to quality healthcare which includes mental health benefits can help put you back on the road to "I Do."

We offer a telephone consultation with a COBRA expert with 20 years experience. If you need some coaching call 1-866-439-0964. Ask for George Fox.