Florida 2-15 Life, Health and Variable Annuity AgentGeneral Knowledge of Health InsuranceMedium
A client is enrolled in a group health insurance plan. If they leave their employment, which federal law allows them to continue their health coverage for a limited period, typically 18 or 36 months, by paying the full premium plus an administrative fee?
- AConsolidated Omnibus Budget Reconciliation Act (COBRA)
- BHealth Insurance Portability and Accountability Act (HIPAA)
- CEmployee Retirement Income Security Act (ERISA)
- DAffordable Care Act (ACA)
Show answer & explanationAnswer & explanation
Correct answer: A. Consolidated Omnibus Budget Reconciliation Act (COBRA)
COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that allows employees and their families to continue their health benefits for a limited time after certain qualifying events, such as job loss, divorce, or death, by paying the full premium plus an administrative fee.
Why the other options are wrong
- B. HIPAA primarily addresses health information privacy and portability, not continuation of group coverage.
- C. ERISA regulates employee benefit plans, including health plans, but doesn't specifically grant continuation rights.
- D. ACA focuses on expanding access to affordable health insurance and marketplace plans.
COBRA Continuation Coverage
A federal law allowing employees and their families to temporarily continue health benefits after job loss or other qualifying events, at their own expense.
- Applies to employers with 20 or more employees.
- Coverage typically lasts 18 or 36 months.
- Individuals pay the full premium plus up to 2% administrative fee.
- Triggered by qualifying events like termination, reduced hours, divorce, death.
Memory trick: Leaving a job? COBRA helps you bridge the gap!