Sale of Company Affects COBRA Continuation
To make certain how the sale of this company will affect your current COBRA coverage, you should contact the insurance carrier or COBRA administrator directly. They would be aware of any special provisions in this transfer that might enable you to remain on COBRA. If you have been covered under this group health plan for at least 18 months, you are eligible for a guaranteed issue individual health plan under federal HIPAA regulations. If you learn that your COBRA is for certain going to terminate, contact us again or reply to this blog posting and we can assist you in understanding your HIPAA rights and where you can go to find guaranteed issue coverage. 2 CommentsLeave a comment |
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I am currently on Cobra but the company is being sold to another existing firm. Some existing employees will be terminated on the closing date and rehired the next day while others remain terminated. My question is whether or not my Cobra benefits will continue to be available to me if the company I worked for is being bought?
In most cases, yes, your COBRA will end when the company you previously worked for ceases to exist. As you probably know, COBRA is a continuation of your previous group health plan. A group health plan is tied to the company to whom that coverage was issued. If that company ceases to exist, either because they went out of business, or were bought by a different company, so does the group health plan, as well as coverage for any ex-employees that are currently insured under COBRA continuation. An exception to this rule would be if the company has negotiated with your current insurance carrier to transfer the existing policy to the new corporation. The insurance carrier is not obligated to do so, and will most likely request that a new application for group health insurance be submitted. When this happens, the previous group plan terminates.
I am currently on Cobra for a disabity and have been told that my company is closing. What alternatives due I have to continue Cobra when this happens
Comment by Debbie Lagadinos — March 6, 2009 @ 10:06 am
Comment by Debbie Lagadinos — March 6, 2009 @ 10:25 am
Wow! That really sound like a bummer! I have health insurance coverage with my position at my workplace, just like my colleges, but I am going on COBRA this year. I am really surprised to hear that my COBRA is not really guaranteed after all. I guess what I am saying is that many of us is in the same situation and rely on having these options available to us. With the economy today, how can we know what will happen? In my line of industry we are not looking to good at the moment. I would hate to see our companies fail, and then add to that leave a lot of employees without health insurance.
You mention something about HIPAA? But is HIPAA tax-deductible like COBRA is with the stimulus package? I can’t remember the name of the law, but isn’t COBRA eligible for deduction?
Comment by Mary — May 31, 2009 @ 10:41 am