What is the Cost of COBRA Continuation Coverage?

Qualified beneficiaries electing COBRA continuation coverage may be required to pay the full premium for the coverage.  In calculating premiums for continuous coverage, a plan can include the costs paid by both employee and employer before the qualifying event, plus an additional 2% to cover administration costs.  This means that the total premium for the continued health care coverage can be up to 102% of the premium for similarly situated individuals who have not experienced a qualifying event.

If an individual enrolled in COBRA due to termination of employment or a reduction in hours is disabled (and means certain other eligibility requirements), the maximum period of COBRA coverage may be extended for an additional 11 months, for a total of up to 29 months of continuation coverage.

In an individual enrolled in COBRA due to termination of employment or a reduction in hours is disabled (and meets certain other eligibility requirements), the maximum period of COBRA coverage may be extended for an additional 11 months, for a total of up to 29 months of continuation coverage.

In the event that COBRA continuation coverage is extended due to disability, the beneficiary may be charged up to 150% of the applicable premium during the 11-month disability extension period only.  The employer or plan administrator may still only charge a qualified beneficiary 102% of the applicable premium for COBRA continuation coverage during the initial 18-month period.