Job changes can occur for many reasons - sometimes voluntary and sometimes not. Often, people do not consider the impact a job change can have on health insurance coverage. Luckily, when armed with the right information, you can make smart health insurance decisions so you are covered during the change.
Consolidated Omnibus Budget Reconciliation Act (COBRA)
This governmental act provides workers and their families the right to choose to continue their previously-held group benefits for a limited time. Usually, COBRA requires employers with 20 or more employees to offer employees the opportunity for temporary extension of coverage - often up to 18 months.
While you often are required to pay your full health insurance premium, the group rates you're afforded are usually much cheaper than if you had to get individual health coverage. The following are situations in which COBRA becomes available to you:
- You leave the company - for whatever reason - and are either unemployed or self-employed.
- You are the divorced spouse or child of someone who left the company after three years or more of employment.
- You are spouse or child of a person who died while working for the same company for three or more years.
- You are the child of someone who left a job and are not yet 23 years old.
To qualify for COBRA benefits, you must complete the appropriate forms with your former employer within 60 days of leaving. If you don't do so before that time is up, you might not be able to acquire coverage.
For more information on COBRA, visit the Department of Labor.
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