COBRA Control Services, LLC

On July 29, 2009, Governor David A. Paterson signed into law Chapter 236 of the Laws of 2009, which extends state continuation coverage to 36 months, regardless of the qualifying event.  This extension will assist employees and their dependents who are eligible for federal COBRA coverage in fully insured products or New York State continuation coverage. 

The federal Consolidated Omnibus Budget Reconciliation Act (COBRA) allows employees who work for employers with 20 or
more employees to continue their current group health insurance once they leave employment or have a reduction in hours that makes them ineligible for employer-sponsored coverage.  New York State continuation coverage, also known as “mini-COBRA,” gives the same right to employees who work for employers with fewer than 20 employees.

Before the new state law went into effect, the length of time that a person could have state continuation coverage depended on why the
person was losing coverage.  Under the new law, all people eligible for state continuation coverage may continue their coverage for a total of 36 months, regardless of the reason for the coverage loss.

Under COBRA, if an employee loses coverage due to voluntary or involuntary termination of employment or reduction in hours, then
coverage generally may be continued for up to 18 months from the date coverage would otherwise terminate.  Under the new law, a person eligible for COBRA may elect 18 months of COBRA and 18 months of state continuation coverage, for a total of 36 months.

For more information, please see the Frequently Asked Questions below.

FREQUENTLY ASKED QUESTIONS

When does this law take effect?

The law effects policies or contracts issued, renewed, modified, altered or amended on or after July 1, 2009.  For most policies, the new benefit will apply on the policy’s annual renewal date. You can check with your insurer to determine the renewal date.

How will I receive notice about the extended state continuation benefit?

The law did not change any notice requirements. If you have a qualifying event such as job loss, you will receive notice from
your employer or employer’s benefits administrator.  The notice will provide instructions on how to elect COBRA or state continuation
coverage.

Does this law change COBRA or state continuation coverage in any other way?

No.  All current COBRA and mini-COBRA coverage laws will still apply.  Also, health insurance benefits will remain the
same.  The only difference is that employees can continue their health insurance for up to 36 months rather than 18 months.

If I am entitled to federal COBRA, do I have additional continuation rights under New York law?

Yes.  If you are eligible to continue health coverage under COBRA for 18 months, then you can continue coverage under state
continuation coverage for an additional 18 months.  Note, however, that you have up to a total of 36 months of coverage when combining the COBRA and state continuation benefits.

I am covered through a self-insured plan.  Does this law apply to me?

No.  The law only applies to fully insured plans.

Does the size of my employer affect the length of time of continuation coverage?

No.  Former employees will be allowed to extend their health insurance from 18 months to 36 months, regardless if they worked
for a small employer or large employer.

Will employers have to pay the cost of the additional coverage?

No.  Employees will continue to pay the premium cost.

Does this extension of continuation coverage apply to Healthy NY?

Yes.  The extension applies to Healthy NY group contracts.

Under the previous state continuation coverage laws, people determined to be disabled under Title II or Title XVI of the Social
Security Act were entitled to 29 months of continuation coverage.  Has this law changed?

Yes.  People determined to be disabled under Title II or Title XVI of the Social Security Act are now entitled to up to 36 months of continuation coverage.  There is no longer a specific section in the law pertaining to these people, because all eligible persons are entitled to
continuation coverage for 36 months. 

People who are disabled under Title II or Title XVI of the Social Security Act are eligible for up to 29 months of federal COBRA coverage, plus up to an additional 7 months of state continuation coverage, for up to a total of 36 months. Federal law states that these people are responsible for up to 102% of the premium for months 1 through 18 of coverage and up to 150% of the premium for months 19 through 29 of coverage.  Under the new law, they would also be responsible for up to 102% of the premium for months 30 through 36 of coverage.

Can the duration of state continuation coverage end earlier than 36 months?

Yes.  The 36 month period may end sooner due to the following reasons: (1) timely premium payment is not made to the plan; (2)
the employer ceases to maintain any group health plan (including successor plans); (3) the employee or member is covered under any other group health plan that is not maintained by the employer, even if that other coverage is less comprehensive than COBRA or continuation coverage; or (4) the qualified beneficiary becomes entitled to Medicare benefits.

What if I need more information about this law?

Contact the Insurance Department’s Consumer Services Bureau at (212) 480-6400 or 1-800-342-3736.

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