Texas COBRA Law

For workers in Texas who become ill or suffer an injury, employer-sponsored health plans are critical to them getting the medical care they need. Unfortunately, when an employee loses his job, or gets his hours cut at work, he may lose the benefits that he and his family relies on for their healthcare needs. If you or your dependents lose your group healthcare coverage due to job loss, a reduction in hours, divorce, separation or another qualifying life event, you may be eligible for federal COBRA or Texas state continuation coverage according to Texas law. Contact a knowledgeable employment law attorney today to discuss your right to temporarily extend your group healthcare coverage for a certain period of time.

What is COBRA Coverage?

The federal Consolidated Omnibus Reconciliation Act (COBRA) allows retiring employees, or those who lose insurance coverage due to voluntary or involuntary job loss or a reduction in work hours, to continue their group health plan for a limited period of time. COBRA continuation coverage also applies to dependents who lose coverage because of a qualifying life event, or any change in the employment relationship that results in a loss of health benefits, i.e. divorce or separation, death of the covered employee, the covered employee qualifying for Medicare, or loss of dependent status under the health plan’s provisions. COBRA continuation coverage applies to employers who have 20 or more full-time employees, and extends health benefits for a period of up to 18 months.

Texas State Continuation Coverage

The Small Employer Health Insurance Availability Act requires healthcare continuation rights for employees and their beneficiaries of company health plans for small businesses. For employers who have between two and 19 employees and meet certain criteria, Texas offers an extended state COBRA insurance plan, which can be used immediately following the federal COBRA coverage, or in place of it, for those who do not meet the requirements for federal COBRA insurance. Texas continuation state law allows employees to extend their group health plan for six months, to begin after any federal COBRA extension period ends, or for nine months, to begin immediately, if federal COBRA coverage does not apply. Therefore, employees who are eligible and opt for COBA coverage, plus Texas state continuation coverage, can extend their healthcare coverage for a total of 24 months, while they find a new health plan.

What You Should Know About COBRA

Healthcare benefits extended under the Consolidated Omnibus Reconciliation Act are the same as the benefits provided by the employer-sponsored health plan, and in order for an employee to qualify for state continuation coverage, he must have been continuously covered under the group contract for at least three consecutive months immediately before the end of his employment, and the health plan must have been issued by an insurance company or HMO subject to Texas insurance laws and rules. COBRA continuation coverage applies as long as the employee’s loss of employment was for any reason other than involuntary termination for cause. An employee, spouse, or dependent child has 60 days after qualifying for COBRA coverage to decide whether to enroll in the health plan, and once they decide to enroll, they will be responsible for paying the full premium, plus a 2% administrative fee.

An Experienced Texas COBRA Law Attorney Can Help

While group health coverage for COBRA participants can be more expensive than health benefits extended to active employees, since COBRA participants are typically required to pay the entire premium themselves, federal or state continuation coverage is generally less expensive than individual health insurance plans. If you lost your group healthcare coverage at work, and you think you and your family may qualify for a temporary extension of benefits, you may be eligible for federal COBRA or Texas state continuation coverage. Consult a knowledgeable employment law attorney in Texas today to discuss your rights.