Quick Answer
In an insured group plan, the sponsor holds the group policy and members receive certificates; a self-funded plan follows its governing documents. Federal Consolidated Omnibus Budget Reconciliation Act (COBRA) continuation can preserve eligible group coverage temporarily. Marketplace plans protect pre-existing conditions, but enrollment rights, financial help, cost sharing, and limited-benefit products require separate checks.
Use the plan documents, the person's qualifying event, and the coverage category to choose the right rule.
How Are Group Plans Organized?
- Insured group plan: The insurer issues the policy to the sponsor, while covered members receive certificates. Read the entire-contract clause before deciding which documents control.
- Self-funded plan: The sponsor pays covered claims from its funds under governing plan documents.
- Contributory plan: Members pay part or all of the premium. A noncontributory plan is sponsor-funded.
- Dependent eligibility follows the plan and law. Federal age-26 protection applies when a subject plan offers dependent-child coverage; it does not cover the child's spouse or children. Birth, adoption, or placement can open at least a 30-day special-enrollment window.
When Can Federal COBRA Continue Coverage?
- The plan must be subject to COBRA, a qualifying event must cause coverage loss, and the person generally must have been covered the day before the event.
- The common private-plan size test is at least 20 employees on more than half of typical business days in the prior calendar year. State and local government plans can qualify; federal and church plans are outside federal COBRA.
- Termination other than gross misconduct or reduced hours can provide up to 18 months. Death, divorce or legal separation, specified Medicare-entitlement events, or loss of dependent status can provide an affected spouse or child up to 36 months.
- A qualifying disability can extend an 18-month period to 29 months total when the Social Security, timing, continued-disability, and notice conditions are met. A second event can extend an affected spouse or child to 36 months from the original event, not add 36 months.
- COBRA does not require new evidence of insurability. Each qualified beneficiary has an independent election right.
Which COBRA Deadlines and Premiums Matter?
| Requirement | Federal minimum or maximum |
|---|---|
| Election window | 60 days from the later of coverage loss or election notice |
| First premium | 45 days after election |
| Later premium | 30-day grace period |
| Ordinary premium cap | 102% of total plan cost |
| Disability-extension cap | 150% while the disabled beneficiary remains covered; otherwise 102% |
The continuing person generally pays the full premium plus any permitted administrative charge. Coverage can end early for unpaid premiums, the employer ending every group health plan, specified post-election other coverage or Medicare entitlement, or comparable fraud. Pre-election other coverage does not itself meet those triggers.
How Do Marketplace Protections Work?
- Marketplace plans cannot reject someone, charge more, or refuse otherwise covered treatment because of a pre-existing condition.
- Bronze, Silver, Gold, and Platinum describe average cost sharing across members, not quality, networks, formularies, or one person's exact bill.
- Financial assistance can reduce a plan's net premium. Losing job-based coverage can open an enrollment route, but a diagnosis alone does not create one; verify current dates and options.
- Plan selection does not prove active coverage. The insurer's enrollment confirmation, first-premium record, and effective date establish different activation facts.
- Short-term medical, fixed-indemnity, and other limited-benefit products may follow different rules. A narrow product does not become comprehensive major-medical coverage because it pays a health-related benefit.
Which Gotchas Trip Students Up?
- COBRA continues the group plan temporarily; conversion creates separate coverage under its own terms.
- Compare continuation and individual coverage using current enrollment dates, coverage dates, cost, network, and plan terms.
- Metal level describes cost sharing. The plan's network, drug list, authorization rules, and out-of-pocket terms still control.
- An application or plan selection does not replace the insurer's enrollment confirmation or prove that the first premium was paid.
One-Breath Recap
In an insured group plan, the sponsor holds the policy and members receive certificates; a self-funded plan follows its governing documents. Federal Consolidated Omnibus Budget Reconciliation Act continuation requires a covered plan, a qualifying event causing coverage loss, and an eligible beneficiary. Keep the 18-, 29-, and 36-month maximums separate from the 60-day election window, 45-day first-payment period, and 30-day grace period. Marketplace plans protect pre-existing conditions, while metal levels measure average cost sharing. Limited-benefit products can follow different rules and do not replace comprehensive coverage.
Need more than the recap? Read the full Group Health, Continuation Coverage, and Marketplace unit.