COBRA FAQ

Consolidated Omnibus Budget Reconciliation Act of 1986, COBRA

Q. What is COBRA?
COBRA gives you and your dependents rights to continue medical, dental and prescription drug coverage, under the Plan under certain circumstances, when you would otherwise lose coverage.  You and or your dependents may elect to continue medical, dental and prescription coverage under the Plan after certain “qualifying events” at your cost.  If you are leaving Taylor University, carefully consider the cost of COBRA.  Taylor University underwrites the majority of the cost for health insurance for our employees, therefore, you will be paying full cost of health insurance under COBRA.

Q. What is a qualifying event?
There are five qualifying events:

• Your termination of employment (for any reason other than your gross misconduct or your reduction of hours that would result in a termination of coverage under the Plan)
• Your becoming entitled to Medicare benefits
• Your divorce or legal separation from your spouse 
• A child ceasing to be a dependent child under the eligibility requirements of the Plan or
• Your death

Q. Who is considered a “qualified beneficiary”?
You are a qualified beneficiary if you are covered under the Plan on the day before a qualifying event and you are:

• An employee
• A spouse of an employee
• A dependent child of an employee
• A child born to or placed for adoption with an employee during the period of continuation coverage

Q. How long can I participate in the COBRA program?
It depends on your qualifying event.

• Termination of employee’s employment (other than by reason of gross misconduct), 18 months
• Reduction in employee’s hours of employment, which results in the end of group health coverage, 18 months
• Upon the death of employee (the beneficiary is entitled), 36 months
• Divorce or legal separation of employee and spouse, 36 months
• Employee becomes entitles to Medicare benefits, 36 months
• Child ceases to be “dependent child” under the Plan, (employee’s child), 36 months
• Employee becomes entitled to Medicare and within 18 months experiences a termination of employment (for reasons other than gross misconduct) or reduction in hours of employment that results in the end of group health coverage, 36 months. 

Q. Are there other reasons that my COBRA benefits would cease?
Yes.

• If payment of premiums for the COBRA coverage is not made in a timely manner
• The qualified beneficiary becomes covered under any other group health plan
• The qualified beneficiary becomes entitled to benefits under Medicare after electing COBRA coverage
• The date on which the University ceases to provide any group health plan to any employee
• The qualified beneficiary ceases to be disabled, if continuation coverage is due to a disability

Q. What kind of coverage will I have while on COBRA?
You will have the same medical, dental and prescription coverage as an active employee.

Q. How long after my qualifying event do I have to decide if I want to participate in the COBRA program?
You and your dependents must elect continuation of coverage within 60 days after either:

• The date the qualified beneficiary would lose coverage due to the qualifying event
• The date on which notice of the right to continued coverage is sent by the Plan Administrator