On May 2 the U.S. Department of Health and Human Services announced a special enrollment period giving COBRA beneficiaries the chance to switch to an individual policy option through the Affordable Care Act exchanges. The special enrollment period runs through July 1, 2014.
The HHS announcement pertains only to the federally facilitated marketplace for residents of participating states. According to the Kaiser Family Foundation, these states include: Alabama, Alaska, Arizona, Florida, Georgia, Indiana, Kansas, Louisiana, Maine, Mississippi, Missouri, Montana, Nebraska, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Wisconsin and Wyoming. Many of the remaining states are expected to make similar announcements.
The marketplace offers a variety of individual policy options with different benefit levels and premium rates from a choice of private insurance companies. Premium assistance via subsidy is also available for certain persons, depending on household income and other criteria. For many COBRA beneficiaries, the ACA marketplace options may be more attractive and affordable than remaining on COBRA. However, the marketplaces open enrollment for 2014 policies closed on March 31and the next open enrollment does not begin until this fall for 2015 policies.
Outside of open enrollment, only persons who have a specific special enrollment event can enroll for individual coverage at the marketplace. Examples of special enrollment events include marriage or divorce, birth or adoption of child, moving between states, becoming eligible for a subsidy or involuntary loss of other coverage. Normally COBRA enrollees would have to wait until the next marketplace open enrollment to switch to an individual policy. The newly-announced special enrollment for COBRA beneficiaries gives them another chance to consider the marketplace.
In its announcement, HHS expressed concern that COBRA participants, and persons considering electing COBRA, were not sufficiently informed about the marketplace and special enrollment rules. For this reason, federal officials are taking the following actions:
- The marketplace will offer an additional special enrollment period through July 1, 2014 for persons eligible for or enrolled in COBRA. Contact the marketplace call center at 1-800-318-2596 to activate the special enrollment period. Callers are advised to tell the representative that they are calling about their COBRA benefits and the marketplace.
- The Department of Labor (DOL) is releasing new model COBRA notices for use by employers and their COBRA administrators. The new COBRA general notice and COBRA election notice advise beneficiaries to consider all options, including Marketplace individual policy options, before deciding whether to enroll in COBRA. Click on the links below for the updated notices:
For more information, visit HHS Bulletin Allowing COBRA Qualified Beneficiaries to Enroll in the Health Insurance Marketplace.
Laura Kerekes is chief knowledge officer at ThinkHR, an HR consulting firm based in Pleasanton, Calif. She can be reached at 925.225.1100.
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