COBRA continues group health coverage after specific events. Start with who is covered, then which events qualify and for whom.
The employer test
COBRA generally applies to group health plans maintained by employers with at least 20 employees on more than 50 percent of typical business days in the previous calendar year. Both full- and part-time employees count, each part-timer as a fraction equal to hours worked divided by the hours required for full-time status.
Worked example: 17 full-time employees plus 6 half-time employees. 6 x 0.5 = 3, and 17 + 3 = 20. The plan is subject to COBRA.
Number traps on the same page:
- COBRA uses 20. So does the ADEA. Title VII, the ADA, GINA and the PWFA use 15. A "more than 15 employees" answer for COBRA is wrong.
- 50 is the FMLA-style headcount, not COBRA's.
- The "20 or more calendar weeks" structure belongs to Title VII, not COBRA.
- Dropping the more-than-50-percent qualifier, or ignoring part-timers, are the other two distractors.
Qualifying events
- For the covered employee: termination of employment for reasons other than gross misconduct, and reduction in work hours. Maximum 18 months, running to the employee, spouse and dependent children.
- For the spouse and dependent children additionally: divorce or legal separation, death of the covered employee, loss of dependent child status, and in limited situations the employee becoming entitled to Medicare.
Termination for gross misconduct is excluded from qualifying events altogether, so no continuation right arises from that discharge — not 18 months, not 36, and not coverage at 150 percent. A change of insurance carrier is a plan change, not a qualifying event.
Who notifies, and how fast
The employer must notify the plan within 30 days after: termination or reduction in hours, death of the employee, the employee becoming entitled to Medicare, and employer bankruptcy.
Divorce, legal separation and loss of dependent child status are beneficiary-reported. For those, the plan may set a deadline no shorter than 60 days from the latest of the event, the loss of coverage, or notice of the obligation. Keeping that split straight is what the notice items test.