COBRA Coverage

[MSimler]

What is the name of your state? NJ

Having given 2 weeks notice, my last day on the job will be Oct. 31st. My new job starts Monday, Nov. 3rd. I have just been informed by my HR person that my health insurance ends on Oct 31st and since we are a small business I am not eligible for COBRA coverage. Does this mean I am uncovered for those two days, or should my new coverage be retroactive to Nov 1st? With all the laws NJ has, is retroactive coverage a normal thing, or does it depend on the employer/carrier, etc.?

Thanks,
MSimi

 

[cbg]

You will be uncovered for those two days. No state requires, and I have never heard of a company that would permit, the retroactive extension of coverage to cover time prior to your first day of work. Nor does the law of any state require an employer to extend the coverage of a terminated employee beyond the last day they actually worked, unless COBRA is an option and the employee has elected COBRA. It is quite legal and not at all uncommon for an employer to cancel the coverage until after they have received both the COBRA election form and the check, then to reinstate it retroactively. However, that is the only situation I can think of when coverage would go into effect retroactively.

If your current employer (the one you resigned from) has less than 20 employees, then your HR person is correct that COBRA does not apply. If they have more than 20 employees, then COBRA is required. New Jersey has no state continuation requirements that apply in your situation.

 

[MSimler]

Thanks for the quick reply. It is true that our company has less than 20 employees, that's why COBRA is not an option. Our insurance here runs by the month, so the last day of the month in which you terminate is the last day of coverage. If I had left on Oct 20th, I would still be covered to the 31st. I was just hoping since it ended on the beginning of the month, it might also START on the beginning of the month! Guess I'll just have to be extra careful this weekend.
MS

 

[cbg]

You need to check with your new employer as to when you are eligible for insurance coverage. Just as it is up to the company and/or their insurance carrier as to when coverage ends (it would be just as legal to end on the last day of your employment as it would on the last day of the month) it is also up to the employer/carrier as to when coverage will start, and it is not unusual, or illegal, for there to be a waiting period of 30, 60 or even 90 days before you can begin coverage with a new employer.

Since COBRA is not an option for you, IF that is the case you might want to consider taking out a short term policy that would cover you from November 1 to whenever the coverage at your new employment begins. It would not be cost effective to do that for two days (assuming you could even find a carrier that would write a short term policy for two days) but it might be worth your while if you are going to be otherwise unensured for longer.