An example why Cobra and Open Enrollement is Broken!

[bluelogic]

On March 2018 I resigned from my executive position and started my own business. My previous employer agreed to pay 12 months out of 18 months for my COBRA coverage. I now have 6 months before my COBRA ends. So here is where the system is broken. I OWN the company and I pay the health care coverage for 25 employees and I can't be on the coverage because open enrollment has ended. What should I do "fire" myself and rehire so I have a job loss?

Bluelogic

 

[cbg]

I'm not sure what you're trying to do. Are you trying to drop the COBRA from your former employer now that you're responsible for the whole cost, and enroll on the plan that your current company, which you own, has for its (your) employees? (There's nothing wrong with that - I just need clarification.)

 

[bluelogic]

Yep. I can volunteer to drop the COBRA coverage but it doesn't count as a SEP.

*Something funny. Since I don't qualify for any ACA subsides my COBRA coverage is actually very close to the cost.

 

[cbg]

Why didn't you drop the COBRA coverage during Open Enrollment?

 

[justalayman]

*Something funny. Since I don't qualify for any ACA subsides my COBRA coverage is actually very close to the cost.

Then feel blessed since cobra cost is the actual cost of the coverage plus a 2% administrative fee. If you are paying anything less than the full cost of the coverage, there is either a mistake or you are recieving a benefit the former employer is not obligated to provide.

 

[bluelogic]

@CGB yea I should have dropped it during my companies open enrollment in October 2018 (I wanted to milk out the Nov-Feb previous employer paid COBRA. We are on JustWorks.

@justalayman you are correct. Moving to my company's health plan is basically the same cost.

 

[cbg]

If a voluntary COBRA drop is not a qualifying event on your plan (it is on ours) then I think you're stuck till your COBRA expired. But I gotta tell you, as one who works with it every day, it's not that the system is broken (such as it is; the entire health insurance program in this country is broken IMO) as it is that you failed to use it to its best advantage.

 

[bluelogic]

@cbg I have never heard of a voluntary COBRA drop being a SEP. If I left my previous employer's COBRA payment benefit in open enrollment last year I would have missed out on over $5K in paid premiums to get the same coverage on ACA with almost the same cost. I just thought it funny I'm paying for a health plan for my employees that I can't myself get on until open enrollment.

 

[cbg]

I have never heard of a voluntary COBRA drop being a SEP

I've been administering employee benefits for 40 years and I have. But if it isn't on your plan, that's all she wrote. Hopefully the $5000 your former employer paid exceeds the amount that you're now going to pay for the next six months; otherwise it was a foolish decision on your part.

 

[bluelogic]

It is the same amount; however, I will ask our plan if it considers it a QLE to leave COBRA or a change in COBRA premiums due to the employer no longer paying.

 

[cbg]

It's always worth asking.