How the Affordable Care Act Impacts COBRA
Hi, my name is Kraig Marton. I'm the head of the employment law section at our firm. As such I represent both employees and small to mid-size employers in all kinds of employment matters.
How has the Affordable Care Act influenced or changed COBRA coverage?
COBRA is a federal statute that gives employees certain rights and it has not really changed under the Act but, as a practical matter, the Affordable Care Act will change how it operates. Under COBRA, any employer with twenty or more employees must offer their employees continued health insurance after a qualifying event. Usually a qualifying event is a termination or resignation of employment. The employer then has to let the employee continue on the health insurance plan but the employee must pay for their share of, for all of the insurance. That has not changed. That Federal law is still in place, but now there are more reasons why people may not choose to use the COBRA coverage. It used to be there was a good reason not to do that because insurance policies could exclude pre-existing issues. However, under the Affordable Care Act, that is no longer a factor and so even an employee who is ill can go to the exchange and look for a better policy and they may choose not to exercise their COBRA rights.
What happens if my former employer fails to offer COBRA coverage?
If an employer fails to provide the COBRA notice or offer a COBRA coverage, there are some fines and penalties that can be imposed, but far greater risk to the employer is they could end up having to pay the medical bills that the ex-employee is incurring because the employee would have been covered by COBRA insurance and didn't, so it can be a substantial risk if you do it wrong.
Kraig Marton has over three decades of legal experince with a unique blend of employment, healthcare and first amendment law expertise. At Jaburg Wilk he has represented both employers and employees in all manners of employment law disputes ranging from FMLA to wrongful termination; from retaliation to discrimination. Additionally, he counsels employers regarding compliance with wage & hour laws, EEOC, DOL and other regulatory requirements.