What to Know About COBRA Insurance When You Lose Your Job
By Lyle Therese A. Hilotin-Lee, J.D. | Legally reviewed by Laura Temme, Esq. | Last reviewed April 17, 2025
This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw’s team of legal writers and attorneys and in accordance with our editorial standards.
The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area.
COBRA insurance allows employees who lose their jobs to continue their existing group health coverage for a limited period. Eligibility requires that the employee was covered by the group health plan before termination and that the employer had 20 or more employees. COBRA coverage can last from 18 to 36 months, depending on the qualifying event.
Losing a job is difficult enough without the extra stress of losing your health insurance plan. Fortunately, the Consolidated Omnibus Budget Reconciliation Act (COBRA) is in place. Established in 1986, this federal law allows employees to continue their existing health coverage for a limited period after job loss or other qualifying change.
If you've lost your job and need guidance on COBRA insurance, an attorney can help you understand your rights and options. Contact a local employment attorney to ensure you get the coverage you are entitled to during this transition.
This article answers frequently asked questions (FAQs) about COBRA law. It will give you a better understanding of your rights to continued insurance coverage.
Are You Eligible for COBRA Insurance?
Both full-time and part-time employees can receive continuing COBRA insurance coverage, subject to eligibility requirements. These factors include:
- Plan coverage
- Qualified beneficiaries
- Qualifying events
According to the U.S. Department of Labor, an employer must have 20 or more employees within its group health plan on more than 50 percent of a typical business day within the previous calendar year to offer COBRA coverage.
In addition, the eligible employee must have been a "qualifying beneficiary" or an individual covered by a group health plan before the discharge or termination. The qualifying beneficiary can be either an:
- Employee
- Employee's spouse
- Employee's dependent child
Lastly, there must have been a "qualifying event" or something that would have caused an individual to lose health coverage. This includes:
- Losing a job
- Reduced hours of employment
- Divorce or legal separation of a covered employee
Losing group health coverage should not be due to gross misconduct by the covered employee.
Related Article: How Does COBRA Insurance Work?
What are the Benefits Covered by COBRA?
If you opt to continue your insurance coverage through COBRA, it will cover the same benefits as your previous group health plan. In general, it is the same COBRA benefits you've had before the qualifying event. As a recipient of the COBRA coverage, you will enjoy the same options, benefits, and services comparable to those received by active employees. You can also pick a different coverage option during the open enrollment period.
Similarly, you must follow the same restrictions and regulations as all the other participants. This includes:
- Deductibles
- Co-payment obligations
- Coverage caps
The process of filing health benefits claims and challenging the denial of claims likewise applies to you. If changes to the health plan apply to active employees, it will also impact you and your other beneficiaries. In addition, if a covered employee had a child or adopted a child while under COBRA insurance, the coverage will automatically consider the child a qualified beneficiary.
How Do I Elect To Use COBRA Continuation Coverage?
To be eligible for COBRA continuation coverage, you must have been enrolled in your employer's health plan at the time your employment ends. Employers must notify plan administrators of a qualifying event within 30 days.
Plan participants and beneficiaries will receive an election notice within 14 days after the plan administrator receives notice of a qualifying event. You have 45 days after electing coverage to pay the initial premium.
The COBRA election notice includes the following:
- COBRA premium payment rates
- COBRA election period (e.g., 60 days)
- Coverage options and the due date
How Long Does My COBRA Coverage Last?
COBRA mandates that the continuation of coverage starts from the date the qualifying event occurred until 18 or 36 months. The type of qualifying event that triggered your COBRA rights often dictates the length of coverage. But a plan could also offer continuation coverage longer than the maximum period the law requires.
Termination of employment or reduction in hours of employment
If the qualifying event is the termination of a covered employee or reduced work hours, qualified beneficiaries can receive 18 months of continued coverage.
Effect of Medicare Entitlement
If employees become eligible for Medicare less than 18 months before they experience job changes, their spouse and dependents can receive COBRA coverage for up to 36 months.
The COBRA coverage starts when the employee qualifies for Medicare. For instance, if a covered employee qualified for Medicare eight months before their date of employment ends, the COBRA coverage of the employee's spouse and child would be up to 28 months.
The formula is 36 months of eligible COBRA coverage minus eight months of Medicare coverage. For further details on how Medicare affects COBRA coverage, contact the Department of Labor's Employee Benefits Security Administration at askebsa.dol.gov or call 1-866-444-3272.
Can I Extend My COBRA Coverage?
Yes. You can extend your COBRA coverage under two circumstances:
First: Disability of Qualified Beneficiary
If a qualified beneficiary is disabled and all other beneficiaries receive continuation coverage because of a qualifying event, they can extend their COBRA coverage for 11 months. The total maximum coverage is 29 months.
The Social Security Administration (SSA) determines whether the beneficiary was disabled within the first 60 days of COBRA coverage. That disability should have lasted throughout the 18-month coverage period. But once the SSA finds the qualified beneficiary no longer disabled, the disability extension ends. The plan should give at least 30 days' notice after the SSA's determination.
Note that during this 11-month extension, the plan could raise the COBRA premium payment by up to 150% more than the regular monthly premium.
Second: Occurrence of Qualifying Event
For instance, a second qualifying event happens during the first 18-month period of your COBRA coverage. In this case, you can also receive an additional 18-month coverage extension. This totals the continuation coverage to 36 months. The following are examples of qualifying events:
- Divorce or legal separation from the covered employee
- Death of the covered employee
- Loss of dependent child status under the plan
Note that you should inform the plan of the second qualifying event. The plan has a set notification period, which should not be less than 60 days from the latest of:
- The occurrence of the second qualifying event.
- The date you lose coverage because of the second qualifying event.
- The date you are advised of the obligation to notify the plan and the notification procedure.
Is My COBRA Coverage Still Valid if My Company Closes or Declares Bankruptcy?
If a group health insurance no longer exists, then COBRA coverage is not available. But, if the company offers another plan, you may receive insurance coverage under that plan. In addition, union members who are part of a collective bargaining agreement that offers a health insurance plan could also be eligible for continuing coverage.
Who Pays for COBRA Coverage?
Beneficiaries must pay for their own COBRA coverage. The premium cannot exceed 102% of the plan's cost for similarly situated individuals without a qualifying event. This includes the portion paid by employees and any paid by the employer before the qualifying event, plus 2% for administrative costs.
Premiums for qualified beneficiaries receiving the 11-month disability extension may increase under certain conditions to 150% of the plan's total cost of coverage.
COBRA beneficiaries remain subject to the plan's rules, including rate increases. Beneficiaries must satisfy all costs related to co-payments and deductibles, and are subject to other benefit limits.
Where Can I Go To Learn More About COBRA Laws?
Several federal government agencies administer COBRA continuation coverage laws. The Department of Labor and the Department of the Treasury oversee private group health plans, while the Department of Health and Human Services manages the laws for state and local government health plans. Both the Department of Labor and the Department of the Treasury share the enforcement of COBRA provisions.
For public sector employees, the Centers for Medicare and Medicaid Services also offers information related to COBRA provisions.
Need Help With COBRA Law? Seek Legal Advice
Understanding your rights under federal COBRA law can be challenging. This is particularly the case if you are under the stress of a job transition.
Consider consulting an employment attorney for personalized legal advice about your COBRA rights. They can offer you valuable insights specific to your situation. They can help you interpret how COBRA laws apply to your case. Employment attorneys can also guide you through the procedures to secure your health coverage.
You do not have to navigate these legal challenges alone. Contact an employment attorney experienced with COBRA coverage to ensure your rights and peace of mind.
Can I Solve This on My Own or Do I Need an Attorney?
- Some employment legal issues can be solved without an attorney
- Complex employment law cases (such as harassment or discrimination) need the help of an attorney to protect your interests
Legal cases for wage and benefit issues, whistleblower actions, or workplace safety can be complicated and slow. An attorney can offer tailored advice and help prevent common mistakes.
Stay up-to-date with how the law affects your life

Learn more about FindLaw’s newsletters, including our terms of use and privacy policy.