COBRA

COBRA (short for Consolidated Omnibus Budget Reconciliation Act of 1986) is a federal law that allows for continuation of coverage under an employer's group health plan to covered persons (called "qualified beneficiaries") in the event of a qualifying event.

A qualified beneficiary is an individual who, on the day before the qualifying event, is covered under the Plan either as an employee, enrollee's dependent spouse, or enrollee's dependent child. A qualified beneficiary is also a child born to the employee, or who is placed for adoption with the employee during a period of COBRA continuation coverage.

A qualifying event is an occurrence which, but for the continuation coverage available under the Plan, would result in the loss of coverage for a qualified beneficiary. Under COBRA, qualifying events include the loss of coverage that otherwise would result due to:

• Termination of employment, for reasons other than gross misconduct
• Reduction in hours of employment
• Death of the enrollee
• Divorce or legal separation
• Entitlement to Medicare
• Loss of dependent eligibility