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An individual is covered by a group health insurance plan through their employer. If the individual leaves their job, which federal law ensures they have the option to continue their health coverage for a limited period by paying the full premium?
- AEmployee Retirement Income Security Act (ERISA)
- BAffordable Care Act (ACA)
- CConsolidated Omnibus Budget Reconciliation Act (COBRA)
- DHealth Insurance Portability and Accountability Act (HIPAA)
Show answer & explanationAnswer & explanation
Correct answer: C. Consolidated Omnibus Budget Reconciliation Act (COBRA)
COBRA allows eligible employees and their dependents to continue group health benefits for a limited period after certain qualifying events, such as job loss, by paying the full cost of the premiums.
Why the other options are wrong
- A. ERISA regulates employee benefit plans, including health plans, but COBRA is the specific law for continuation of coverage.
- B. The ACA (Obamacare) expanded access to health insurance and reformed the market but does not specifically govern continuation of employment-based coverage post-termination.
- D. HIPAA protects health information and ensures portability of coverage between jobs, but COBRA specifically addresses continuation of group coverage.
COBRA (Consolidated Omnibus Budget Reconciliation Act)
A federal law that gives employees and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances.
- Applies to employers with 20 or more employees.
- Coverage typically lasts 18 or 36 months.
- Qualified beneficiaries pay the full premium, plus an administrative fee.
- Triggered by qualifying events like job loss, reduction in hours, divorce, or death of the employee.
Memory trick: Federal laws protect your health coverage rights.