Under the disability extension, the maximum COBRA period is extended to a
maximum period of up to 29 months. Before you get too excited, if you do receive the 11 month disability extension of COBRA coverage, the premium for those additional months may be increased to 150% of the plan's total cost of coverage.
The extension of coverage may be available
if you are on COBRA and determined by the Social Security Administration (SSA)
to be disabled. The following conditions must be met before the extension applies:
The qualifying event must be the covered employee's termination of
employment or reduction of hours (includes leave without pay or layoff)
A qualified beneficiary (who may be the covered employee, his or her
spouse, domestic partner or dependent child) must be determined under
the Social Security Act to have been disabled at any time during the first
60 days of COBRA coverage;
The qualified beneficiary must notify the COBRA administrator of the Social
Security disability determination within 60 days of the date of
determination and before the original 18 months of COBRA continuation
Disability Onset Date and COBRA
When you receive your Notice of Award letter from SSA, it should state "We have determined that you became disabled on Month, Day, and Year." This is your Onset Date of disability. Usually the day after you left work. If the onset date was not within 60 days of the qualifying event, you would not qualify for the COBRA insurance extension.
Should the disabled qualified beneficiary ceases to be disabled
during a disability extension period, COBRA coverage for the disabled qualified
beneficiary and all family members may be terminated before the end of the
Notifying the COBRA Administrator
The COBRA administrator must receive a copy of the Notice of Award letter from SSA. If you leave work and are disabled, make sure extending your COBRA coverage is part of the list of things you do. This can be your employer or an outside COBRA administrator that your employer has hired.
Send the Notice of Award letter to whomever gets the COBRA premiums each month. Include a note stating:
"Enclosed is the Notice of Award from the Social Security Administration. I believe this qualifies me extend my COBRA for 11 more months. Please respond in writing that I am eligible and enrolled for the disability extension."
If a plan administrator fails to properly inform you, the qualified beneficiary regarding the 60 day obligation, to determine if you qualify for COBRA coverage or an extension of COBRA coverage, the plan administrator must disregard the qualified beneficiary's failure to meet the 60-day notification requirement.
The COBRA Disability Extension and Medicare Entitlement
The 29-month period permits a disabled qualified beneficiary to remain on COBRA
until becoming entitled to Medicare. Note, however, that it is possible for Medicare
coverage to begin before the end of the disabled qualified beneficiary's 29-month
maximum COBRA period. This can occur, for example, when the Social Security
disability date for a qualified beneficiary precedes the termination of employment
or reduction of hours of the covered employee.
All Family participants can stay on COBRA Disability Extension
Under the COBRA statute, the disability extension to a maximum COBRA coverage
period of 29 months applies to all qualified beneficiaries (all family members who
had COBRA coverage) with respect to the qualifying event, not just the disabled
But with the rates being 150% of regular COBRA, not too many family members are going to be paying the premiums!
For instance, If an employee quits their job and elects COBRA for himself, his wife and children. 6 months into the 18-month COBRA period, the participant gets a SSA
determination that he was disabled at the time he quit. John gives timely notice of
his letter to his COBRA administrator. John's entire family is
entitled to the disability extension because they are all qualified beneficiaries.
The extension also applies independently with respect to each of the
qualified beneficiaries. This means that if the requirements for a disability
extension are met, then the disabled qualified beneficiary does not have to elect COBRA so that the other related qualified beneficiaries to can use the disability extension.
If the disabled qualified beneficiary elects COBRA but later loses COBRA
coverage (for example, because he or she becomes entitled to Medicare or chooses
to stop paying for coverage), the related qualified beneficiaries continue to have
the right to an extended COBRA period, as long as the conditions for the
disability extension were met.
If a participant becomes eligible for Medicare and
discontinues the COBRA coverage, the family members may still continue coverage up
to 29 months.