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One question we often receive regarding the length of COBRA continuation is, “How do I know what the maximum period of coverage should be for my employee?” In this article, we’ll take a closer look at several common extensions of COBRA that can influence the maximum coverage period for certain qualified beneficiaries based on state-specific legislation.
Presently, there are only four States which have legislation that works in conjunction with Federal COBRA coverage laws under certain circumstances. They are New York, Connecticut, Texas, and California. New York COBRA Extension: On November 19, 2009, Governor David A. Paterson signed into law Chapter 498 of the Laws of 2009, which amends Insurance Law §§ 3221(m), 4304(k), 4305(e), and section 4 of Chapter 236 of the Laws of 2009 and this describes the COBRA state extension coverage from the standard 18 months to 36 months (maximum). This rule applies to medical coverage only so dental and vision maximum coverage periods remain typical (18, 29, or 36 months depending upon qualifying event type). This COBRA extension is also applicable based on where the group health plan was written and NOT based on the employer’s locality being headquartered in the State of New York. The primary exemption to the rule applies to self-funded plans who do not have to extend federal COBRA coverage laws beyond 18 months for 18-month qualifying event types. Connecticut COBRA Extension: On May 5, 2010 Gov. Rell signed into law Public Act 10-13, which changed the length of time employees who lose coverage under Connecticut fully insured employer health insurance plans may stay on COBRA continuation coverage. Qualified beneficiaries (COBRA eligible persons) can elect COBRA continuation coverage for up to 30 months in the event of layoff, reduction of hours, leave of absence, or termination of employment. The exemption is that self-funded plans are not required to participate in offering the COBRA extended coverage period beyond 18-months. Dental and vision plans are not eligible for the extension, and so this applies to medical coverage only, similar to the New York extension of COBRA continuation coverage. These COBRA extension rules do not apply to an employer based on location but rather apply based on where the group health policy was written/signed. For example, a Rhode Island employer who may have a fully insured group health policy out of Connecticut will then comply with the extension to 30 months on 18-month COBRA events. Texas COBRA Extension: Texas law 1251.251, part of the Texas Insurance Code, indicates that any individual who has exhausted COBRA coverage with a termination of employment, leave of absence, layoff, or reduction of work hours qualifying event may extend COBRA coverage (medical only) for an additional 6 months beyond the standard 18 months for a total of 24 months of COBRA continuation coverage. This rule applies to fully insured plans, as self-funded plans are exempt. Like the other states mentioned earlier, the Texas extension of COBRA benefits applies to medical coverage only, and dental and vision plans are not eligible. This, like the New York and Connecticut COBRA state extension, is based on policies signed in the State of Texas, not based on the Employer’s location. California COBRA Continuation aka “Cal-COBRA”: While coverage under Cal-COBRA is considered State Continuation and is entirely separate from Federal COBRA coverage law, this one is worth mentioning as it is a unique COBRA insurance extension that works in conjunction with Federal COBRA. In fact, directly following 18 months of Federal COBRA, many qualified beneficiaries are eligible to continue coverage through conversion onto California State Continuation (Cal-COBRA) for another 18 months, or for up to a total of 36 consecutive months of continuation coverage so long as the qualified beneficiary remains eligible during that time and has completed the enrollment process(es) and remitted premiums. Cal-COBRA is also unique in that it is generally administered by the California insurance carriers directly, so it is quite common for individuals who have completed 18 months of Federal COBRA to enroll directly with carriers into Cal-COBRA and pay the carrier directly for those continuation coverage premiums. Other Rules: Keep in mind there are other maximum coverage periods discussed within the COBRA coverage law, such as the disability extension to 29 months or extension based on second qualifying events that may occur, but this article summarizes the extensions related to State-specific legislation that works directly with COBRA coverage. If you have questions about extending coverage periods for your employees or COBRA participants, we encourage you to work with a COBRA Expert to determine the best course of action. Legal Disclaimer: The information in this website is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from CobraHelp. or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.
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