The Consolidated Omnibus Budget Reconciliation Act (COBRA) allows you to continue group medical, dental and vision benefits when you or your dependents become ineligible for university benefits.
On April 7, 1986, a Federal law was enacted (Public Law 99-272, Title X) requiring employers who sponsor group health plans to offer employees and their families the opportunity for a temporary extension of health coverage (called "continuation coverage") at group rates in certain instances where coverage under the plan would otherwise end.
General Information and Forms
- Frequently Asked Questions (U.S. Department of Labor) (PDF)
- U.S. Department of Labor "Health Benefits Under COBRA" (PDF)
- COBRA Rate Schedule
As an employee of Wayne State University covered by the university's group medical and dental insurance plan, you have a right to choose continuation coverage if you lose this group coverage for any of the following reasons:
- Due to a reduction in your hours of employment (to less than 50% time),
- Leave of absence or absence without pay, or
- Termination of your employment (for reasons other than gross misconduct on your part).
Spouse of Employee
As the spouse of an employee covered by the university's group medical and dental insurance plan, you have the right to choose continuation coverage for yourself if you lose this group coverage for any of the following reasons:
- The death of the employee,
- Termination of your spouse's employment (for reasons other than gross misconduct) or reduction in your spouse's hours of employment,
- Divorce or legal separation from your spouse,
- Your spouse becomes eligible for Medicare, or
- You become eligible for Social Security disability.
Dependent Child of an Employee
The dependent child of an employee covered by the university's group medical and dental insurance plan has the right to continuation coverage if the group coverage is lost for any of the following reasons:
- The death of a parent,
- Termination of a parent's employment (for reasons other than gross misconduct) or reduction in parent's hours of employment,
- Parents' divorce or legal separation,
- A parent becomes eligible for Medicare,
- The dependent ceases to be a "dependent child" under the university medical and dental plan policy, or
- Your parent becomes eligible for social security disability.
How to Continue Coverage
When you lose university benefit eligibility based on your termination of employment, the department of Benefits & Wellness and the HR Service Center will be aware of these changes. You will be mailed an application for COBRA coverage from the external COBRA Third-Party Administrator within 30 days.
Under the law, the employee or a family member has the responsibility to inform the HR Service Center of a divorce, legal separation, or a child losing dependent status under a university medical and dental insurance plan. When the HR Service Center is notified that one of these events has occurred, you will be mailed an application for COBRA coverage from the external COBRA Third-Party Administrator within 30 days.
Under the law, you have at least 60 days from the latter of the date of the notice, or loss of coverage, to apply for COBRA continuation coverage.
If you choose continuation coverage, Wayne State University is required to give you coverage which, as of the time coverage is being provided, is identical to the coverage provided under the plan to all university employees or family members. The law requires that you be afforded the opportunity to maintain continuation coverage for 3 years unless you have lost group health coverage because of a termination of employment or reduction in hours. In that case, the required continuation coverage is 18 months unless the reason for your termination is your disability and then coverage may continue for 29 months. However, the law also provides that your continuation coverage may be cut short for any of the following reasons:
- Wayne State University no longer provides group health coverage to any of its employees; or
- The premium for your continuation coverage is not paid; or
- You become an employee covered under another group health plan; or
- You become eligible for Medicare; or
- You were divorced from a covered employee and subsequently are covered under your new spouse's health plan.
You do not have to show that you are insurable to choose continuation coverage. However, under the law, you will have to pay all of the premiums plus 2% for your continuation coverage.
End of Coverage
Timely submission of COBRA elections and payments are important. You will not be allowed to elect COBRA if you miss the election deadline. Your COBRA benefits will automatically be canceled unless the required premiums are paid on or before the due date. Once COBRA benefits are canceled because of non-payment, they will not be reinstated.
If you do not choose COBRA continuation coverage, your group health insurance coverage will end the first of the month following the month in which you lose eligibility through termination of employment, reduction in work hours, divorce, death, medicare eligibility or loss of dependency.
Flexible Spending Account
This law also applies to Flexible Spending Accounts. If you participate in the Health Care Reimbursement Account, COBRA gives you the right to continue coverage if your employment with Wayne State University is terminated for any reason other than gross misconduct.
Generally, continuation coverage will extend your plan coverage for 18 months. However, COBRA rules must be coordinated with the 12-month period of coverage rules for Flexible Spending Accounts.
This means that if the entire 12-month period required for Flexible Spending Accounts falls during the 18-month COBRA period, you can elect to participate during one additional plan year following your termination. If not, you may only participate through the end of the current plan year.
Dependent Care Reimbursement Accounts are not subject to COBRA.