I've been getting health insurance through Cobra from my last job. I now have a new job, and was told today by benefits person that I can't remain on Cobra since I am now eligible for health insurance through new job. Is this true?
March 25, 2011 12:51 PM   Subscribe

I've been getting health insurance through Cobra from my last job. I now have a new job, and was told today by benefits person that I can't remain on Cobra since I am now eligible for health insurance through new job. Is this true?

I started Cobra coverage in September of 2010 and should be eligible through March of 2012. My plan was to remain on the health insurance through my previous job (and continue to pay Cobra) instead of picking up the plan at the new job. Why, you ask?

Well, my new job is only part-time (this is all I could find), which means that I will have to pay the pro-rated amount for an individual plan. This amounts to $410 a month for the same coverage I am getting through Cobra . On my pitiful part-time salary, this isn't really feasible.

Normally Cobra is extremely expensive. Indeed, I have to come up with $640 each month currently. However, because I still receive some unemployment, and live in the great state of MA, I am eligible for a subsidy for the payments I make to Cobra. This means that I get reimbursed $480 a month for health insurance. So, the cost to me is really only $160 a month.

Is the benefits person correct that I can't continue to elect Cobra since I am now eligible for insurance at my new job? Help!
posted by Sal and Richard to Health & Fitness (11 answers total) 4 users marked this as a favorite
 
As far as I can tell, COBRA is only available to those otherwise ineligible for group coverage. If you're eligible for insurance at your new job, you are no longer eligible for COBRA.
posted by ThePinkSuperhero at 12:53 PM on March 25, 2011 [2 favorites]


Pretty much.
posted by valkyryn at 1:05 PM on March 25, 2011


As TPS said, my understanding is that COBRA eligibility ends when you become eligible for group coverage.

However, since you are in the great state of MA, there are other options to support our health care mandate. Have you looked into the health connector or Mass Health?

Also, you may already be aware of this, but if you do not keep health care coverage you will probably be penalized on your state income taxes.
posted by rollbiz at 1:24 PM on March 25, 2011 [1 favorite]


COBRA is essentially keeping you on your old employer's plan except you are paying for all of it instead of your company subsidizing you as an employee. So, yes, once you have a new employer, you can no longer be covered by your old employer's plan.
posted by cecic at 1:28 PM on March 25, 2011


Response by poster: Thanks for your help. Damn, not what I planned for! This definitely mucks things up for me.
posted by Sal and Richard at 4:04 PM on March 25, 2011


I am no expert, but I think the issue here isn't keeping your old employer's plan through COBRA (I think you can continue to do that for 18 months from the date you left your old employer regardless of your new employment situation) the issue is keeping your subsidy. So if you wanted, you could probably pay the $640 full price for the old plan, but being offered group coverage at your new employer will make you ineligible for the subsidy.
posted by mjcon at 4:08 PM on March 25, 2011


Is it eligibility for coverage or enrollment in coverage?
posted by orthogonality at 4:08 PM on March 25, 2011 [1 favorite]


Best answer: IIf you're still receiving some amount of unemployment, you may be able to get a partial reimbursement for a non-COBRA plan through the MSP. As long as you are within the income limits, you can get an 80% reimbursement.
posted by Cat Pie Hurts at 5:01 PM on March 25, 2011


Response by poster: It is eligibility for coverage, but from what I've learned from benefits lady, I'm not eligible to continue to get Cobra as long as I'm eligible for insurance through the new employer. The real issue is being eligible for the subsidy, which I'm not, as long as I'm not getting Cobra.
posted by Sal and Richard at 9:14 PM on March 25, 2011


Per my wife (who works for the US Dept. of Labor), you are not required to drop COBRA and take your new employers health insurance. Mere eligibility does not end COBRA. It only ends once you actually take and enroll in another group policy. You can ride out your COBRA for the full 18 months, and once they are up you get a 30 day special enrollment right into your new employers health plan.

For more information, you should call the EBSA Toll-free hotline at 1.866.444.EBSA (3272). You'll get a live person to help you (my wife is one of them!)

What's unclear is if you'll still be eligible to receive the health subsidy. If this is being paid through ARRA funds, then mere eligibility for other health insurance ends the subsidy. You should make sure to talk to the EBSA person about this (you will be routed to the Boston office, who are familiar with MA issues).

Good Luck!
posted by neurodoc at 10:47 PM on March 26, 2011


The benefits person is incorrect and Neurodoc is correct. Your COBRA can only be terminated when you ENROLL in a new group health plan, not because you are eligible for it.

When you exhaust COBRA (that is, you use up the full duration of coverage you were entitled to, normally 18 months) if the new group health plan is subject to ERISA, you should be eligible to be a "special enrollee" into your employer's group health plan because you will have experienced a loss of other coverage.
posted by Pax at 9:14 AM on March 28, 2011


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