COBRA continuation coverage lets people who qualify keep their health insurance after their job ends, so it’s not surprising that people who receive a COBRA notice might think they’re job will soon be terminated. Getting a COBRA notice doesn’t necessarily mean you’ll be fired or laid off soon, though. There are other reasons why your employer might mail you a notice.
Does Receiving a COBRA Continuation Coverage Notice Sent by My Employer Mean I’ll Be Fired?
What Are COBRA Continuation Coverage Notices?
COBRA continuation coverage notices are documents that explain employees’ rights under the Consolidated Omnibus Budget Reconciliation Act of 1985. These documents generally contain a variety of information, including the following:
The name of the health insurance plan
Contact information for someone who can explain COBRA coverage in more detail
A description of the plan’s continuation coverage
Details on who qualifies for COBRA coverage and what they must do to obtain coverage
A reminder to tell the plan administrator of any address or beneficiary changes
A legal statement noting that more information is available
When Are COBRA Continuation Notices Sent to Employees?
Strict legal requirements govern when many employers must send COBRA continuation notices to their employees.
Employers are often required to send notifications (or have them sent by a plan administrator) when employees experience qualifying events -- which can include a reduction in hours or termination. Usually when notifications are sent out because of qualifying events, however, they’re given to employees after the event occurs. Receiving a notice typically isn’t a sign of things to come, although it might be a follow-up on something that’s already happened.
Many employers are also required to send COBRA continuation notifications to employees within 90 days of employees first participating in a health plan. If you’ve received a notice without previously been informed of a reduction in hours or termination (or experiencing another qualifying event), it’s likely your employer is simply following this requirement.
So Why Did I Receive a COBRA Continuation Notice from My Employer?
If your employer is required to send notices to employees within 90 days of their plan enrollment, you can expect to receive a notice within 90 days of signing up for an employer-sponsored health plan.
Depending on how your employer's’ benefits package works, you might get a notification within the first few months of your employment. If you receive health coverage on the first day of work, you can expect a notification within 90 days of your hire date. If you get health coverage after a probationary period (e.g. 30 or 90 days), the notification may come a little later.
Starting a new job, however, isn’t the only time that you may be enrolled in a new plan. There are several other scenarios that may explain why you received a COBRA continuation notice even if you’ve been in your current position for a long time:
You may be enrolled in a new plan annually and, therefore, receive a notice each year
Your employer may have just begun offering a health insurance plan
Your employer may have recently hired several new employees, and the increase in the number of employees may force your employer to follow these regulations for the first time
All of these are common scenarios that explain why employees receive COBRA continuation notices from their employers. There’s probably no reason to panic about your job if you get a notice and haven’t previously heard bad news. Your employer is probably just following the law and meeting their notification requirements.
Who Can I Ask If I Have More Questions?
If you still have questions about a COBRA continuation coverage notice you received, feel free to ask someone about the notification. Your employer’s human resources department can likely answer any questions you have. If you’d like additional assistance or an outside view, contact an independent insurance agent who’s familiar with group health plans and COBRA coverage.