What is continuation coverage?
The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances, such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events. This right extends to your plan’s Health Care FSA, unless an exemption applies.
How long will continuation coverage last?
COBRA beneficiaries generally are eligible for group coverage during a maximum of 18 months for qualifying events due to employment termination or reduction of hours of work. Certain qualifying events, or a second qualifying event during the initial period of coverage, may permit a beneficiary to receive a maximum of 36 months of coverage.
For Health Care FSAs, continuation coverage is generally limited to the remainder of the plan year in which your qualifying event occurs, if you have not already received as reimbursement the maximum benefit available under the account for the year. For example, if you elected a Health Care FSA benefit of $1,000 for the plan year and have received only $200 in reimbursement, you may continue your Health Care FSA for the remainder of the plan year or until such time that you receive the maximum Health Care FSA benefit of $1,000.
For More Information
This COBRA Q&A section does not fully describe continuation coverage or other rights under the Plan. More information about continuation coverage and your rights under the Plan is available from your employer or by calling the FBMC Service Center at 1-833-673-3678 (1-833-OSD-FORU).
Upon Termination of employment or loss of coverage during the plan year, except as otherwise provided by law and in accordance with your employer’s plan(s), terminated employees are covered through the last day of the month in which employment ends, unless you decide to extend coverage under COBRA or until coverage for the plan year expires.