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COBRA is the abbreviation of Consolidated Omnibus Budget Reconciliation Act of 1985. Under federal law, groups with 20 or more employees are required to offer continuation of their current group health coverage (medical, dental, vision, and/or cancer) to certain former employees and their families, if applicable, upon the occurrence of certain "qualifying events".

Some qualifying events may include:

voluntary or involuntary termination of employment for any reason other than gross misconduct;
reduction in the number of hours of employment
death of the covered employee;
divorce of the covered employee from the employee's spouse;
entitlement to Medicare for the covered employee;
loss of dependent child status under the plan rules.

Insurance & Benefits (I&B) will receive notification of when an employee's employment with the District will end. Once notified, I&B will send information to the employee advising him/her of what benefits they currently have and the benefit termination date for each, which can be extended through COBRA.

COBRA allows the former employee to continue their current benefits for themselves and dependents (if applicable) up to the maximum of 18 months. The former employee will have up to 60 days from the benefit termination date or the date of the notice (the later of the two) to elect the benefit(s) they wish to continue. Once elected, the COBRA participant ("former employee") will have up to 45 days to pay the first premium(s). COBRA coverage begins the day after the benefit termination date. If COBRA is cancelled for non-payment or is voluntarily cancelled, it can never be reinstated.

Effective February 17, 2009, President Obama introduced the American Recovery and Reinvestment Act of 2009 (ARRA). ARRA provides COBRA premium subsidy for employees whose employment is involuntarily terminated (i.e. loss of position) between September 1, 2008 and ~~December 31, 2009~~ *. Under this provision, employees that are involuntarily terminated may elect COBRA and will be required to pay only 35% of the regular COBRA premium. The subsidy will pay the remaining 65% of the COBRA premium for a period of up to ~~nine (9) months~~ **. The subsidy may end earlier than ~~nine (9) months~~ if:

¨ You become eligible for coverage under another group health plan or Medicare.

¨ COBRA coverage ends – due to failure to pay the required 35% of the COBRA premium.

Please note….even though, you may be eligible to receive the COBRA subsidy, the rules of COBRA will still apply.

*the eligibility date has been extended through February 28, 2010.

**the subsidy premium assistance has been extended from 9 months to 15 months.

Through COBRA, the benefits the former employee had will remain the same. Plan changes can not be made at the time of termination (i.e. 903 PPO Plan to 706 PPO Plan). COBRA participants will have the same opportunity as active employees to make changes during the District's annual Open Enrollment in January/February.

Each benefit will have the same benefit termination date. Please review the information below:

Under federal law, there is a two percent (2%) surcharge in addition to the benefit premiums. The monthly premiums listed below contain the additional two percent (2%). If COBRA coverage is cancelled for non-payment or is voluntarily cancelled, it can never be reinstated.

Cancer (Cancer insurance is portable which means you may continue the coverage by paying the same premium as an active employee for as long as you wish.)

Life Insurance - Life insurance can be converted to an individual policy (a whole life insurance product) by contacting Minnesota Life Insurance Company at 1-866-293-6047 within 30 days of the date your group insurance terminates.

Flexible Spending Accounts (FSA) - Although flexible spending accounts (medical reimbursement only) qualify as group health care plans under COBRA, as a practical manner, former employees do not choose to elect such benefits. After termination of employment, the former employee receives no further income from the employer, and would not be of any tax advantage from the pre-tax payments that are under an FSA. For additional information and account balance, please contact Donna Ernhardt, Flexible Benefits Specialist, in Insurance & Benefits at 337-8318 or click here to send Donna an email.

If you have any questions or concerns, please do not hesitate to contact Insurance & Benefits at 239-337-8321.