What Is COBRA
COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law that allows you to continue your ex-spouse's employer health insurance coverage for up to 36 months after your divorce is finalized. This is critical because divorce typically ends your eligibility as a spouse on their plan immediately.
Coverage Duration and Cost
You have 60 days from the date your coverage ends (usually the divorce decree date) to elect COBRA continuation. Once elected, you can keep the same health plan you had during the marriage, but you pay the full premium yourself, typically 102% of what the employer paid. For a plan costing $400 monthly under your ex's coverage, expect to pay around $408 out of pocket.
The 36-month window applies in most divorce situations. Some states have specific rules about when your ex-spouse's employer must notify you of COBRA rights. Check your state's family law statutes to confirm notification requirements in your jurisdiction.
When COBRA Matters in Divorce
COBRA becomes part of your financial planning during divorce settlement negotiations. If you need continuous coverage and cannot qualify for another plan immediately, COBRA provides a bridge. Without it, you might face a coverage gap, particularly important if you take medication or receive regular treatment.
Courts sometimes address COBRA in the divorce decree itself, specifying who pays premiums or when coverage ends. Some settlements include language requiring your ex to maintain the employer plan's availability or to notify you of termination.
Limitations and Important Deadlines
- Your ex's employer must have at least 20 employees for COBRA to apply. Smaller employers are exempt.
- The 60-day election period is strict. Missing it means losing COBRA rights permanently, with no exceptions for not receiving notice.
- If your ex loses their job or their employer cancels the plan, your COBRA coverage ends immediately.
- COBRA does not cover life insurance, dental plans, or vision coverage unless the original plan included them.
- You must pay premiums on time. One missed payment typically terminates coverage.
Alternatives to Consider
COBRA is expensive. Explore health insurance alternatives simultaneously. Marketplace plans under the Affordable Care Act may cost less, especially if your post-divorce income qualifies you for subsidies. Some ex-spouses are required by settlement to pay your COBRA or marketplace premiums for a set period, though enforcement varies by state.
Common Questions
- Does my ex have to tell me about COBRA? The employer is required to notify you, but notification is sometimes delayed or lost. You should request information directly from your ex's HR department within 30 days of your divorce being final.
- Can I switch plans during my COBRA period? No. You must take the same coverage your ex had. You can only change if the employer offers open enrollment to active employees.
- What happens after 36 months? COBRA ends completely. Before month 36, verify whether you can enroll in your own health insurance plan, such as a marketplace plan or plan through future employment.