60 Day Rule in Electing a COBRA
One of the beauties of COBRA is that you have 60 days to decide whether you want to elect for a COBRA (and then 45 days after that to pay your first premium) and you can often use that 60 days to your advantage. Anytime within that 60 days, you can elect for COBRA coverage and it will be applied retroactively. For example:
On March 1, 2006, Michael learns that the company he’s working for will be downsizing and that he will be RIF’d (Reduction In Force) at the end of the month. Michael interviews with another company and is extended an offer that won’t start until June of that year. For the period of April and May, Michael will be without medical coverage from either his former employer or his new employer and will need to rely on a COBRA. However, on April 1st, Michael doesn’t need to immediately sign up for a COBRA. Since it can be applied retroactively, he can wait until he needs it within those 60 days before he starts it.
In the above example, if Michael doesn’t need medical insurance at all in the sixty days between jobs, he doesn’t have to elect for COBRA. If let’s say he needs it in May, he would have to elect for the COBRA and pay the premiums for April and May. It’s a great way to be “covered” but not covered and you can avoid paying premiums you don’t have to.
This is also how you can be covered, medically, if you resign from a company on a Friday and don’t start work until Monday. COBRA will cover you in the two days period you are without coverage.
jeremy said,
November 16, 2006 @ 11:07 am
You wrote that COBRA will be applied retroactively. Does this imply that you could elect COBRA *after* a medical emergency (let’s say you need an ER visit for a broken leg) and still have it cover the past event?
UnderstandCOBRA said,
November 17, 2006 @ 1:19 pm
That’s correct, as long as you elect coverage in that 60 day window you will get coverage retroactively. This doesn’t sound like it’s really possible does it? It’s because you have the 60 days to decide whether or not you want COBRA starting from when the qualifying event happened, whether something happened to you in the interim isn’t held against you.
If you elect coverage on day 60, you will owe payments for days 1 – 59 no matter what (so you can’t say I want COBRA coverage starting Day 60).
barbara said,
December 12, 2006 @ 3:33 pm
question= how long am l still covered from date of resigntion? can l still order my meds from medco? please hurry your answer!
Philip DeVesa said,
February 14, 2007 @ 6:43 am
If I leave my job on Feb. 1st,and I have to get my medications refilled on the 16th of February,am I still covered?
Kate said,
May 9, 2007 @ 8:06 am
Technically in your example above, Michael would be without coverage for 61 days (31 days in May). I am hoping to not have to elect COBRA for July and August of this year, but that is 62 days. Are the “60 days” really two months? What happens if i’m 2 days over, dont elect COBRA, and then move onto my grad school’s insurance?
Scott said,
August 24, 2007 @ 7:35 pm
I sent a COBRA payment for myself and family on August 8th: check was dated the 8th, to cover an April premium, which really wasn’t due until the end of May. The COBRA ins notice was sent to me in June (first week) sometime. Again, I sent another premium out to cover the May premium on behalf of my company. The union processed this payment. However, I found out today, they refused to process my April COBRA payment. I was told that my check I sent on the 8th of Aug. was still sitting on the business managers desk. ( 3 weeks) I asked why they didn’t process it, because I need my prescriptions filled. They told me, basically they weren’t going to honor the payment because it was past the deadline. I received no notice of this of any kind. It wasn’t past the deadline at all. In fact, I still have 45 days to send in my payment. Is this legal? I mentioned the guidelines of COBRA payments from the US Department of Labor and all of a sudden they were all concerned about getting something resolved. Am I wrong or right, that’s all I want to know?
Thanks Scott
Nancy said,
September 14, 2008 @ 2:39 pm
I was wondering if there are any repercussions for electing COBRA coverage, but when the bill comes never paying it? Let me explain: I left my last job on July 25th, and started a new job on August 4th where my insurance coverage will not start until October 1st. I received a notice from my plan administrator that I had until September 23rd to enroll in COBRA, and another 45 days to make the first payment if I do choose to enroll. If I don’t elect coverage before September 25th, I lose all rights to coverage and if something happens to me before October 1st, I have to pay for it myself. However, say I elect COBRA coverage on September 20th, and I make it to October 1st without something happening to me. Say I then get my bill for COBRA coverage: can I simply not pay it (I know that that will cancel COBRA)? What will they do if I simply not pay it? Will it go on my credit report? If I do make the election and then something does happen to me before October 1st then I will surely pay it, but I just want to know what the repercussions would be if I don’t pay it.
Jim said,
February 8, 2009 @ 5:25 am
I left me employer On February 1, 2008 and was never offered Cobra. Is there some kind of penalty for not offering Cobra? What are my options since it has been a year with no cooperation ?
UnderstandCOBRA said,
February 11, 2009 @ 8:02 am
Your employer should send you a package, if not you should contact them because it’s probably a paperwork error. Otherwise, contact the Department of Labor.