The purpose of this webpage is to help you learn about coverage continuation rights that are available under a group health benefit plan. The primary coverage continuation rights and options that are available to a person who is no longer eligible for group HMO coverage are COBRA and state continuation.
COBRA
The federal Consolidated Omnibus Budget Reconciliation Act of 1986 (COBRA) applies to employers with 20 or more employees. It gives laid-off employees and their families the right to remain on whatever health plan the employer has for up to 18 months if they continue paying the full premium, which includes both the employer's share and the employee's share plus a 2 percent administrative fee. Employers who are subject to COBRA are required to give laid-off employees a written notice of their COBRA rights. The employees then have 60 days to decide whether to continue their health care coverage as provided by COBRA.
Detailed information about COBRA is available from the U.S. Department of Labor (DOL). The DOL also has a free COBRA consumer publication on its site. You can get a printed copy by calling 800-998-7542. The DOL's regional office in Dallas at 972-850-4000 can answer questions about COBRA.
State continuation
Texas law provides coverage continuation rights for employees who aren't covered by COBRA or who have exhausted their COBRA coverage. A former employee and their family may remain on their former health plans for up to nine months if not eligible for COBRA and six months if eligible for COBRA, by paying the full premium. This requirement applies only to health plans issued by licensed insurance companies and HMOs that are subject to the Texas Insurance Code. It doesn't apply to employer self-funded (ERISA) health care plans, which are exempt from state insurance laws.
Learn more in our Health care coverage guide. For more information, call our Help Line at 800-252-3439.