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What is Continuation Coverage and How Does It Protect Your Health Benefits?
Definition & Meaning
Continuation coverage is a type of health insurance that allows eligible employees and their dependents to maintain their group health benefits after experiencing a qualifying event, such as job loss or reduction in work hours. This coverage is often provided under the Consolidated Omnibus Budget Reconciliation Act (COBRA), which ensures that individuals can continue their health insurance at group rates for a limited time. The coverage must be identical to what is offered to active employees in the same plan.
Table of content
Legal Use & context
Continuation coverage is primarily relevant in the context of employment law and health insurance regulation. It is used when discussing employee benefits, particularly in cases where individuals face a loss of health coverage due to specific life events. Legal professionals may encounter this term in civil law, particularly in cases involving employee rights and benefits. Users can manage certain aspects of continuation coverage through legal forms and templates provided by services like US Legal Forms.
Key legal elements
Real-world examples
Here are a couple of examples of abatement:
Example 1: A person loses their job due to company downsizing. They are eligible for continuation coverage under COBRA, allowing them to keep their health insurance for up to 18 months while they seek new employment.
Example 2: A married couple goes through a divorce. The spouse who was covered under the other's health plan may qualify for continuation coverage to maintain their health benefits for a limited time after the divorce is finalized. (hypothetical example)
Relevant laws & statutes
The primary law governing continuation coverage is the Consolidated Omnibus Budget Reconciliation Act (COBRA), enacted in 1986. This federal law provides guidelines for continuation coverage and outlines the rights of qualified beneficiaries.
State-by-state differences
Examples of State differences (not exhaustive):
State
Key Differences
Alaska
State laws may offer additional benefits beyond federal COBRA requirements.
California
California has its own continuation coverage law (Cal-COBRA) that extends coverage for up to 36 months for certain individuals.
New York
New York provides additional protections and longer coverage periods under state law.
This is not a complete list. State laws vary and users should consult local rules for specific guidance.
Comparison with related terms
Term
Definition
Key Differences
COBRA
A federal law allowing continuation of health coverage after job loss.
COBRA specifically refers to the federal law; continuation coverage can also include state laws.
Cal-COBRA
California's state law providing extended continuation coverage.
Cal-COBRA offers longer coverage periods than federal COBRA.
Common misunderstandings
What to do if this term applies to you
If you find yourself eligible for continuation coverage, take the following steps:
Review your eligibility and qualifying events.
Contact your employer or plan administrator to obtain necessary forms and information.
Consider using legal templates from US Legal Forms to help manage the process.
If your situation is complex, consult a legal professional for tailored advice.
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