Health Insurance Coverage After Involuntary Job Loss in Missouri

Health Insurance Coverage After Involuntary Job Loss in Missouri

If you involuntarily lose your job or suffer a reduction in work hours that results in a loss of group health insurance coverage for any reason other than for gross misconduct (the “qualifying event’), and your former employer has more than 20 employees and you were covered by a group insurance plan, under federal law you may be entitled to continue your prior coverage.

The federal law that applies is called COBRA.

To potentially qualify for COBRA coverage, you must be:

An employee who had a voluntary or involuntary (other than for gross misconduct) termination of employment (a “covered employee”)
The spouse or dependent child of the covered employee
The widow(er) or orphan of the covered employee
The former spouse of the employee
The child of the former spouse of the employee and the employee

The cost of insurance coverage under COBRA is a maximum of the premium paid by the employer for the insurance plus a 2% administrative fee. If the employer previously subsidized the cost of the insurance, it may – but is not required to --continue to provide this subsidy.

The time for which continuation coverage is available depends on the type of event that triggered the availability for COBRA coverage:

Employees, dependent children and dependent spouses can continue coverage for 18 months when the qualifying event is job loss or reduction of work hours
Dependent spouses and children can continue coverage for 36 months if the covered employee becomes eligible for Medicare, there is a divorce or legal separation or if the child loses dependent status

In some cases where an individual is not eligible for coverage under COBRA, Missouri law gives the right to continue coverage for up to 9 months in certain limited circumstances.

To qualify for coverage under Missouri law:

The group policy must have been delivered or issued for delivery in Missouri
The employee or member of the group with the health insurance must have been continuously covered under the group policy for the 3 months immediately prior to the termination of coverage
The employee or member must request continuation of coverage in writing within 31 days of the date that coverage would otherwise terminate
The spouse of an employee or member whose coverage would otherwise terminate due to divorce or the death of the member or employee has the same rights to continuation of coverage as the employee or member
Coverage is NOT available to individuals who are or could be covered by Medicare or individuals who are or could be covered by any other insured or uninsured arrangement that provides hospital, surgical or major medical coverage for a group of which the individual was not a covered immediately prior to the termination of coverage.

The continuation coverage must include maternity coverage, if maternity coverage was provided under the group plan before, but it need not include dental, vision care or prescription drug or any benefit other than hospital, surgical or major medical benefits.

The person electing to continue the coverage must pay to the policy holder, monthly, the amount of the premium required to maintain coverage. That amount cannot exceed the group rate for coverage, but if any benefits are being excluded, the premium will be reduced accordingly. The first premium payment must be given to the group policyholder within 31 days of when the coverage would otherwise terminate.

The laws regarding the continuation of health insurance following the termination of employment or the reduction of work hours resulting in the loss of health insurance coverage are complex and every situation is different. Do not rely on this summary to make decisions: speak to your group health insurance administrator of the Missouri Division of Insurance for advice on your particular situation.

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