TN 57 (10-22)

HI 00805.330 Individuals with GHP Coverage Under COBRA


The Consolidated Omnibus Reconciliation Act (COBRA) of 1985 amended the law to require that group health plans of covered employers provide employees and certain family members the opportunity to continue health care coverage under the GHP in certain instances (called qualifying events) where coverage under the GHP would otherwise be terminated.

Qualifying events are:

  • The death of the covered employee.

  • The termination (other than by reason of such employee's gross misconduct), or reduction of hours, of the covered employee's employment.

  • The divorce or legal separation of the covered employee from their spouse.

  • The covered employee becoming entitled to benefits under title XVIII (Medicare) of the Social Security Act.

  • A dependent child ceasing to be a dependent child under the generally accetable requirements of the plan.

Individuals covered under COBRA are never covered under a GHP by reason of current employment status which is a requirement for the SEP or premium surcharge rollback. Even when COBRA coverage is in effect by reason of a reduction of employment hours, as distinguished from termination of employment, it is in effect because the individual no longer qualifies for the regular group health plan based on employment.

Similarly, COBRA coverage for qualified dependents is not based on current employment status even when the employee continues to qualify for regular GHP coverage. That is, in the case of divorce or legal separation, or a dependent child ceasing to be a dependent child, the qualified dependent is eligible for coverage solely by virtue of the provisions of the COBRA statute.

NOTE: The rules above apply only for individuals who do not enroll in SMI during the 8-month period following the last month of coverage based on current employment status.

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HI 00805.330 - Individuals with GHP Coverage Under COBRA - 10/31/2022
Batch run: 10/31/2022