How does COBRA affect my group insurance coverage when I leave a job?
If you leave your job, you can keep
the insurance offered by the company's group plan for up to 18 months. Your right to
obtain this extended coverage is guaranteed by a federal law, the Consolidated Omnibus
Budget Reconciliation Act of 1985, whose acronym is COBRA. Details vary from state to
state, but COBRA generally allows you to purchase insurance through your employer's group
plan for the same price the employer pays (plus 2% extra to cover administrative costs).
If you're disabled, your COBRA rights last for 29 months. Buying COBRA insurance isn't
always a great idea. If the company you work for offers a medical plan, it's probably
paying at least part of your premiums for you. If you left the company, your employer
would no longer be required to subsidize your payments. So, under COBRA, you'd pay the
full tab yourself, which can be hefty. You might want to exercise your COBRA rights and
stay with the plan if you can't get coverage elsewhere, or if the coverage is the cheapest
and best that you can obtain. You will need to shop the market to determine the best