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COBRA Vs USERRA - which to use and when?

Updated: Jan 29





USERRA, the Uniformed Services Employment and Reemployment Rights Act, mandates that all employers, regardless of their COBRA or ERISA exemption status, provide continued benefits to employees on military or uniformed services leave. This ensures that service members can maintain their health coverage while fulfilling their duty to the nation.


Under USERRA, eligible employees can continue their benefits for up to 24 months during their absence for military service. This duration surpasses the standard 18-month coverage period offered by COBRA, providing extended support to service members and their families.


Employers must adhere to USERRA's provisions regarding coverage continuation and payment obligations. Similar to COBRA, employees on military leave are responsible for paying premiums, which can amount to 102% of the full cost. This financial responsibility ensures that individuals can maintain their health coverage without undue burden on employers.


To ensure compliance with USERRA, employers should establish clear procedures for employees to elect coverage continuation and make premium payments. These procedures can mirror those used for COBRA administration, providing consistency and clarity for both employers and employees.


Upon the service member's return from military leave, employers must promptly reinstate their health coverage without imposing waiting periods or pre-authorization requirements. This seamless transition ensures that returning employees can access necessary medical care without delay.


In cases where employees fail to pay premiums, employers can implement grace periods and, if necessary, cancel coverage due to non-payment. These measures help maintain the integrity of the benefits system while providing flexibility to employers in managing administrative tasks.

For example, consider a scenario where an employee, John, is called to active duty in the National Guard for 18 months. During his absence, his employer continues his health coverage under USERRA, allowing John to focus on his military service without worrying about losing access to healthcare.


In conclusion, USERRA plays a crucial role in safeguarding the health benefits of employees serving in the military or uniformed services. By understanding and complying with USERRA's requirements, employers can support service members and their families during times of deployment and ensure a smooth transition back to civilian life upon their return.

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