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U.S. Department of Labor Seal U.S. Department of Labor

Health Benefits Advisor

Parent's Employer Has 20 or More Employees

If you have lost (or will lose) coverage under a group health plan sponsored by your parent's employer, employee organization (such as a union), or both due to the loss of dependent child status, you may have the right to elect COBRA continuation coverage at group rates. If that coverage is no longer offered, you will generally be able to obtain whatever coverage your parent's employer, employee organization, or both now makes available to similarly situated non-COBRA beneficiaries.

The plan administrator of the group health plan sponsored by the parent's employer, employee organization (such as unions), or both, must be notified of your having lost dependent child status under the plan before you can elect COBRA continuation coverage in these circumstances. You can and should give the plan notice of your loss of dependent child status as soon as possible. The plan should have rules for how this notice should be provided, and you can find information on the plan's rules in the plan's SPD (summary plan description), which you can request from the plan administrator. The plan must allow you at least 60 days after you lose dependent child status to provide this notice. Generally not later than 14 days after you notify your parent's group health plan of your loss of dependency status, you should receive a written election notice from the group health plan explaining your right to elect COBRA continuation coverage. The written election notice from the group health plan should explain how long you will have to decide whether or not to elect COBRA continuation coverage. The plan must give you at least 60 days from the date the notice is provided to you, or from the date your coverage ended, whichever is later, to elect COBRA continuation coverage. The election notice should also explain how much you must pay for coverage and when and to whom the payments are due. You may find that COBRA continuation coverage costs more than the coverage you had before you lost dependency status because many employers will not continue to pay a share of the cost of your coverage after such an event. However, the premium payment you will make while on COBRA continuation coverage will be at group rates and is generally less expensive than coverage you would obtain on your own directly from an insurance carrier or HMO. For more information, see An Employee's Guide to Health Benefits Under COBRA.

COBRA continuation coverage can last for up to 36 months and generally cannot be extended. However, coverage may terminate earlier if you fail to make timely premium payments, you become covered by another group health plan or Medicare after electing COBRA continuation coverage, your parent's employer, employee organization (such as a union), or both ceases to sponsor a group health plan, you move or relocate to an area which the group health plan does not serve, or for cause according to the plan rules. If the plan terminates your COBRA continuation coverage early for any reason, the plan must give you a notice explaining why it is doing so and describing the date of termination.

Depending on your circumstances, you may have health care options other than COBRA continuation coverage available, including coverage through a plan sponsored by your employer or your spouse's employer (if applicable), Medicaid, Medicare or CHIP (State Children's Health Insurance Program). Before making any decisions, you should carefully consider the information on COBRA continuation coverage and the other coverages for which you may be eligible to determine which one will best meet your needs. Keep in mind that COBRA continuation coverage is temporary health coverage. In some instances you may be eligible again for certain special enrollment rights once your COBRA coverage expires.

In choosing among the options available to you, you should review the SPD (summary plan description) for each available group health plan to determine which plan best meets your needs. You should also review and compare the information on the other coverages for which you are eligible. In making your decision, you may want to consider such things as:

  1. Any waiting period (or affiliation period) imposed under the plans;
  2. Types of benefits offered (Is dependent coverage available? Do the benefits cover your family's medical needs?);
  3. Cost of coverage (premiums, co-payment and deductibles for prescription drugs and doctor visits);
  4. Limitations on coverage; and
  5. Any exclusions from coverage (treatments, procedures, conditions or prescription drugs).
UNITED STATES
DEPARTMENT OF LABOR