Illinois Group Health Insurance
Illinois COBRA health insurance laws are crucial for all IL residents to understand as they deal with the right to keep health insurance coverage. Maintaining health insurance coverage is one of the most important things to do for any individual residing in the United States that wishes to safeguard against unexpected expensive medical bills. The single greatest cause of personal bankruptcy in the US (and most likely in Illinois as well) is unpaid medical bills.
The number of uninsured people in Illinois and across the country keeps rising due to the rising health care costs and the lack of money. It is said that the middle class American lives from pay check to pay check, in order to be able to save money for bills and that savings accounts have become rarer in this country as time goes by. In fact, it is estimated the United States average individual savings rate is in the negative numbers (individuals are spending more than they make). The Federal Government has tried to pass laws aiming to erase that large number of uninsured and some of these measures have succeeded. The Consolidated Omnibus Budget Reconciliation Act (COBRA) passed in 1986 amended previous laws such as the Employee Retirement Income Security Act, certain sections of the Interval Revenue Code and the Public Health Service Act.
The Purpose of Illinois COBRA Health Insurance
What COBRA does is provide former employees, retirees, spouses, former spouses, and dependent children the right to continuation of Illinois group health insurance coverage at group rates. It is important to note however, that group health coverage for people eligible for COBRA is usually more expensive than those of active employees (but only up to a maximum of 102% of the total premium amount for both employer/employee premiums). The reason for this is that employers usually pay part of the COBRA premium for active employers, while former employees will most likely end up having to pay the whole premium amount themselves. Illinois COBRA health insurance premiums for former employees will be approximately twice the cost of an Illinois individual health insurance plan with similar benefits.
The Eligibility Criteria for Illinois COBRA Health Insurance
Under Illinois Law there are important elements that make a person eligible to receive COBRA benefits and a continuation of their group health insurance. The first one is the type of plan coverage that they have. COBRA only applies to group health plans for employers with 20 or more employees on 50 percent or more of its business days. Both full and part time employers will qualify, however; a part-time employer is only counted as a fraction of an employee. The second are the required qualifying evens for the employees, which include the voluntary or involuntary termination of employment for reasons other than gross misconduct and the reduction in the number of hours of employment. The third are the required qualifying events for the spouses’ of the employees which include the employee’s admittance to Medicaid, the divorce or separation from the employee or the death of the covered employee. The fourth and final elements are those required for the employee’s dependent children. These include but are not limited to the loss of dependent child status under the plans rules and all the other events mentioned above for the required qualifying events of both the spouse and the employee.
The Process for Receiving Illinois COBRA Health Insurance
In the state of Illinois, the process of receiving COBRA health insurance benefits is not a complicated one. The employer must first notify the employee of their eligibility according to the Illinois state laws. Once the employee is offered a continuation they must decide to continue with the coverage within a certain time period (called the election period). It is important to understand that the employee has to let the employer know if he/she wants to continue with the coverage before the election period expires, or they can lose the coverage permanently. If there is a choice between a State continuation and a Federal continuation, the employee must also make his mind about which coverage to pursue before the election period is over. Coverage then will be available for the exact length of time given to the eligible person(s) by the state’s laws; however it can end earlier in case the employee is eligible for Medicare or if the employer decided to no longer offer group health plan benefits.
There are two things of importance that you must know and keep in mind when having COBRA coverage. The first one is that as stated above, you will almost always have to pay the whole premium; even the portion previously paid by your employer before you were eligible for COBRA. Sometimes you will even have to pay an administrative fee along with your premium under certain circumstances for COBRA and spousal continuation (the extra 2% in the 102% limitation). The second important thing you must ALWAYS do is to read your benefit plan summary booklet, for it will give you all the information about what you need to know about your group health plan and about the COBRA program.
Below there will be a list about the plans that are covered by Cobra and the ones that are not, so that you can have a better understanding of who is eligible under the Consolidated Omnibus Budget Reconciliation Act and who is not.
Illinois Plans Eligible under Cobra:
1. Health Maintenance Organizations (HMO)
2. Insured and self-insured group health plans
3. Dental Plans
4. Vision Plans
5. Retiree Plans
6. Health Flexible Spending Accounts
7. Employer Discount Programs maintained by health care clinics
8. Employer Reimbursed Health Insurance Policies
Illinois Plans NOT Eligible under Cobra:
1. Small Employer plans that have under 20 employees
2. Church Plans
3. Federal Government Sponsored Plans
4. Long Term Care Insurance Plans
5. Disability Income Plans
6. Life insurance and accidental death
The Length of Illinois COBRA Health Insurance Benefits
Now that you know what the COBRA plan is and how it works in the state of Illinois is necessary to do some research about your employer to see if you would be eligible for it under any circumstance. Is also good to keep in mind that coverage can last anywhere from 18 months, 29 months or 36 months depending on the qualifying events that triggered the COBRA policy. Also know that COBRA can be easily terminated if you don’t make timely premiums or you become enrolled in a plan with another employer.
Additional Illinois COBRA Health Insurance
Information Resources
If you need more information regarding the COBRA program in the state of Illinois you can access the website at www.idfpr.com. You can also call the Consumer Services Section at (312) 814-2427 or the toll-free number to the Office of Consumer Health Insurance at 1(877) 527-9431. You can also find information about the Federal COBRA laws by calling the U.S. Department of Labor at 1(866) 444-3272 or log into their website at http://www.dol.gov/ebsa.
The Cost of Illinois COBRA Health Insurance
Also remember that Illinois individual health insurance plans are much cheaper than Illinois COBRA health insurance plans or other Illinois group health insurance plans. However, keep in mind that IL individual health plans have different underwriting criteria than IL group health plans so be sure and do your research and speak with a qualified Illinois health insurance agent about the options available to you. Whatever you do; be sure that you don’t get stuck paying the expensive IL COBRA group health insurance premiums needlessly!
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