COBRA Continuation Coverage
20+
Employees
COBRA threshold (not 50)
18 / 29 / 36
Months
Three coverage durations
102%
Premium Cap
Full cost + 2% admin fee
match the event to the bucket
The Three Coverage Buckets
Each qualifying event maps to one of three durations. Memorize the events, the months will follow.
18 months
2 events- Voluntary or involuntary termination (not gross misconduct)
- Reduction in hours
29 months
1 event- SSA-determined disability within 60 days of COBRA event
36 months
4 events- Death of covered employee
- Divorce or legal separation
- Dependent child aging out
- Employee becoming Medicare-eligible
The Notice Cascade
Employer
30 daysNotify plan administrator (termination, hours, death, Medicare)
Qualified Beneficiary
60 daysNotify plan administrator (divorce, separation, age-out)
Plan Administrator
14 daysProvide election notice to QB
Qualified Beneficiary
60 daysElect coverage
Exam Traps
COBRA threshold is 20, not 50
Different from FMLA (50). Frequently confused. Employers with 20+ employees on a typical business day are subject.
Gross misconduct cuts off COBRA
Standard termination triggers COBRA. Termination for gross misconduct does not. The exam loves this distinction.
102% is the MAX, not the minimum
Full premium plus 2% administrative fee. Employer can charge less. Cannot charge more — except 150% during the 11-month disability extension.
Spouses and dependents can elect independently
Each qualified beneficiary has their own election right. Employee declining does not bind spouse or dependents.
Misconduct cuts COBRA
Gross misconduct termination disqualifies the employee from COBRA. Mere termination does not.
Three buckets
18 for hours and termination. 29 for SSA-disability. 36 for death, divorce, age-out, Medicare. Memorize the buckets.
Your employers group health plan. The company covers most of the cost while you live there.
You can sublet the apartment from yourself. COBRA makes this possible — but you pay the full rent now plus 2%.
Sublet for 18 months at 102% of full premium. Same goes for hours reductions.
If SSA says you are disabled, sublet stretches to 29 months. Last 11 can cost up to 150%.
Spouse loses coverage from divorce, death, dependent age-out, or employee Medicare entitlement. 36 months at 102%.
Plan administrator has 14 days to send election notice. You have 60 days to elect. Miss the window, no sublet.
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