The COBRA Act of 1985 requires an
employer-funded plan to offer continuation of
coverage for 18 to 36 months. The rub is that
this coverage is usually very expensive, as
we discussed in the first article.
If you lose your job, you have up to
60 days to apply for COBRA coverage. You then
have up to 45 days to pay your first premium.
Meanwhile, you are covered during this 105
day period. If you suffer a major health
crisis during this period, and before you have
obtained new coverage, all you have to do is
pay your COBRA premium to access your
coverage.
The HIPAA Act of 1996 is extremely important
to employees who have a family member with a
serious pre-existing condition. With regards to
changing employers or losing your job, HIPAA
generally does the following:
1. Guarantees continuous health insurance
coverage for a pre-existing condition if it was
covered by the previous employer.
2. Limits to 12 months the time period
a new employer can exclude a pre-existing
condition if the previous employer did not cover
it.
3. Requires each state to offer some type of
coverage with no exclusions for pre-existing
conditions to those who have exhausted COBRA
coverage.
4. Prohibits discrimination against employees
on the basis of their health.
Losing your job would be very painful but,
let's face it, it happens. If it happens to you,
pay close attention to the requirements and
time frames surrounding continuing coverage and
pre-existing conditions, Also, start your research
now into individual health insurance policies, so
that you have all the facts in front of you, if
you have to make a quick decision.
