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How does the onset of retiree coverage affect COBRA?

Updated: Jan 29



COBRA allows employees to continue employer-sponsored health coverage after certain events, like job loss or reduced hours, applying to employers with 20+ employees.


1. How does retiree coverage impact COBRA eligibility?

If retiree coverage mirrors active employees' in eligibility, benefits, and cost, retirees may not qualify for COBRA. COBRA is required if differences exist upon retirement.


2. When is COBRA required for retirees?


COBRA must be offered if retiree coverage differs from active employees' in cost, benefits, or eligibility terms, triggering COBRA upon retirement.


3. Implications of offering COBRA to retirees?


Offering COBRA ensures retirees continue coverage at their expense. They may choose COBRA if advantageous, considering met deductibles or out-of-pocket maximums, or rely solely on retiree health coverage.


4. Ensuring COBRA compliance for retirees?


Employers must review retiree plans for discrepancies and offer COBRA if differences exist. Clear communication and administrative support are crucial during the transition.

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