Employees who leave an employer now have two options for obtaining health care coverage:
1) Continue coverage through their former employer's group plan under COBRA or MN Continuation (same as COBRA but for groups with <20 employees). In this option, the employee pays 100% of their premium to the former employer for up to 18 months, or until they are covered in other group coverage or default in premium payment.
2) Shop for an individual plan, either directly from an insurance company or through a health insurance exchange like MNsure or healthcare.gov. The Affordable Care Act (ACA) has changed the rules so that insurers can no longer turn down applications based on pre-existing conditions or a person's health status, so people looking for a cheaper alternative to COBRA will have another option.
Outside of ACA's open enrollment period (latest change now will be Nov 15, 2014 - Feb 15, 2015), individuals who are losing access to employer-based coverage due to a job transition or whose COBRA coverage is expiring, will qualify for a "special enrollment" opportunity for individual or family coverage from an exchange (MNsure) or from an insurance company directly. Individuals will have 60 days from the date the employer-based coverage ended (like electing COBRA) to enroll in individual or family coverage. This time frame is the same for individuals exhausting their COBRA coverage. It is important to note that voluntarily terminating COBRA coverage or being terminated for not paying premiums DOES NOT qualify an individual for special enrollment. Individuals, who do elect COBRA, need to understand that they are stuck until the next ACA annual open enrollment to switch to an individual plan, or qualify for another employer group plan. Employers however, must still present their terminating employee and covered dependents their continuation rights through COBRA; that Federal law has not changed.
