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What benefits are covered under COBRA?

According to the U.S. Department of Labor (DOL), COBRA "applies to all private-sector group health plans maintained by employers that had at least 20 employees on more than 50 percent of its typical business days in the previous calendar year." COBRA also applies to plans sponsored by state and local governments. The law does not apply, however, to plans sponsored by the federal government or by churches and certain church-related organizations. In addition, many states have laws similar to COBRA, often called mini-COBRA laws, including those that apply to health insurers of employers with fewer than 20 employees. An employer needs to check with its state insurance commissioner's office on the existence of mini-COBRA laws in states in which it operates.

The DOL defines a group health plan as "any arrangement that an employer establishes or maintains to provide employees or their families with medical care, whether it is provided through insurance, by a health maintenance organization, out of the employer's assets  or through any other means. 'Medical care' for this purpose includes:

  • Inpatient and outpatient hospital care.
  • Physician care.
  • Surgery and other major medical benefits.
  • Prescription drugs.
  • Dental and vision care.

Life insurance is not considered 'medical care,' nor are disability benefits; and COBRA does not cover plans that provide only life insurance or disability benefits."

A health flexible spending account (FSA) is covered in full under COBRA unless it is an excepted benefit. (See the related Q&A on this topic here.) Employer-maintained prescription drug plans, health reimbursement accounts (HRAs) and cancer (disease-specific) policies that provide medical care are generally considered group health plans subject to COBRA. Wellness programs are also covered if they provide relief for medical or health issues.


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