COBRA (Consolidated Omnibus Budget Reconciliation Act) provides rights that may enable you to continue your health insurance coverage for a period of time after you leave work. Continuation is a similar program available in some states for smaller employers. The rules are complicated, but the concept is easy. If you have had health insurance through your employer for a specific length of time, and then lose this coverage, you may be guaranteed to continue the health insurance for a certain amount of time. Your spouse and child or children may also have rights to continue the insurance.

The exception to this right is if you are terminated from employment because of your gross misconduct or the group plan itself ceases to exist. The later could occur if the company goes out of business or drops their insurance coverage.

The number of employees your employer has determines whether you can keep your insurance through COBRA. Generally, if you work for an employer employing 20 or more employees, COBRA benefits may be available to you. If you are eligible, you can usually keep this coverage for up to 18 months. Since each state has its own guidelines, you will need to check with your employer for more details. Your employer is responsible for notifying you of your COBRA rights at the time you are terminated or lose your insurance coverage.

The benefits offered through COBRA are the same as your group health insurance benefits while employed. You will usually be required to pay the full premium for your coverage and an administration fee of two percent. The cost of continuing your coverage may be prohibitive. You need to find out in advance what the costs are if you are planning to use this option. You only have a limited time to elect this option after you leave work.

You generally have 60 days to elect COBRA coverage.

For more information see the Department of Labor