HEALTH PROVISIONS · 5 MIN READ

COBRA Continuation and HIPAA Portability Rules

COBRA lets people who lose group health coverage keep the same coverage active employees receive, at their own expense. Qualifying events define both eligibility and duration: termination of employment (other than gross misconduct) or reduction in hours gives the covered employee, spouse, and dependent children 18 months of continuation; disability (determined by Social Security) extends that to 29 months; and events that strike dependents — the employee's death, divorce or legal separation, Medicare entitlement, or a child aging out — give the affected spouse or child 36 months. A second qualifying event during an 18-month period can extend coverage to 36 months. Qualified beneficiaries are the covered employee, the covered spouse, and dependent children covered the day before the event, plus a child born to or adopted by the covered employee during the continuation period — but not a domestic partner the plan does not recognize as a spouse. The mechanics run on notices and deadlines. The employer or beneficiary must notify the plan administrator of the qualifying event (beneficiaries must report divorce or a child's loss of dependent status), the administrator sends the election notice, and the qualified beneficiary has 60 days to elect continuation. The plan may charge up to 102% of the group rate — the full cost plus a 2% administration load. Coverage can terminate early for premium non-payment (after a 30-day grace period), the employer ceasing to maintain any group plan, or the beneficiary gaining other coverage. HIPAA's portability rules complete the picture. The ACA now flatly prohibits pre-existing condition exclusions in group plans, but HIPAA's creditable-coverage machinery still matters in one corner: Medicare Supplement open enrollment, where prior creditable coverage shortens the up-to-6-month pre-existing look-back. HIPAA also bans discriminating against similarly situated individuals based on health factors and mandates special enrollment rights — letting employees and dependents join a group plan mid-year after events like loss of other coverage, marriage, birth, or adoption.