People who’ve been laid off or furloughed from their jobs now have significantly more time to decide whether to hand on to their employer-sponsored health insurance.

Under the federal law known as COBRA, people who lose their job-based coverage because of a layoff or a reduction in their hours generally have 60 days to decide whether to continue their health insurance. However, under the new rule, that clock doesn’t start ticking until the end of the COVID-19 “outbreak period”, which started March 1st and continues for 60 days after the COVID-19 national emergency ends. That date hasn’t been determined yet.

By extending the time frame to sign up for COBRA coverage, people have at least 120 days to decide whether they want to elect COBRA, and possibly longer depending on when they lost their jobs.

Take the example of someone who was laid off in April and imagine that the national emergency ends August 31st. Sixty days after that date takes the person to the end of October. Then the regular 60-day COBRA election period would start after that. So, under this example, someone whose employer coverage ended at the beginning of May could have until the end of December to make a decision about whether to sign up for COBRA, with coverage retroactive to the beginning of May.

Opting for COBRA is expensive because workers have to pay both their portion of the premium and their employer’s share, plus a 2% administrative fee. In addition, if people elect COBRA several months after losing their coverage, they will be on the hook for ALL the back premiums which may be int the thousands of dollars.

Alternative options to COBRA are available through our office.