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Key Terms for COBRA

This page lists important terms to know when dealing with COBRA in Zenefits.

COBRA Terminology

  • Administration Fees are charged to participants (on top of premium payment amounts) by their COBRA administrator.
    • An employer, Third Party Administrator, or a health insurance carrier can exercise an admin fee as long as they are the designated administrator of the COBRA beneficiary.
    • Admin fees are mandated by COBRA and not set by the administrators.
  • Cal-COBRA is California's State Continuation Coverage equivalent.
  • COBRA is a health provision that requires continuation coverage to be offered to covered employees, their spouses, former spouses, and dependent children when group health coverage would otherwise be lost due to certain specific events.
  • COBRA Classification or COBRA Type is the designated type of COBRA (Federal vs. State) which dictates who has the COBRA administration responsibilities.
  • COBRA Election is the declaration that an employee would like to continue their coverage through COBRA. For Federal COBRA, the deadline to elect is 60 days after termination or when the COBRA notification was sent, whichever is the later. 
  • COBRA Enrollment is complete when COBRA elections sent to the carrier for processing and are completed. The respective COBRA enrollee now has active coverage that is ready to use.
  • COBRA Notifications inform terminated employees of their rights and benefits under COBRA. There are two COBRA notifications that are sent out.
    • The Initial COBRA notification is sent in Zenefits at the time of enrollment
    • The Benefits Termed COBRA notification (most commonly referred to as “the COBRA notification”) is sent by the COBRA Administrator.
  • COBRA Premium is the calculated payment when multiplying the appropriate admin fee towards the total monthly premium.
  • COBRA Qualifying Life Events (QLEs) are events that make employees, and/or their spouses and children eligible for COBRA.
  • COBRA Takeover is when a company switches from one COBRA administrator to another. 
  • Effective Date is the date when COBRA or State Continuation Coverage is set to begin. COBRA coverage is always guaranteed retroactive to the effective date.
  • Federal COBRA applies to employers and group plans that cover 20 or more full-time equivalent employees. It lets employees keep their group plan after being terminated or moved to part-time hours.
  • Qualified Beneficiary is an individual who was covered by a group health plan on the day before a qualifying event occurred which causes a loss of coverage. This can be the covered employee or any dependents on the plan at the time the coverage was lost.
  • State Continuation Coverage, also known as “Mini-COBRA,” are state laws designed to replace Federal COBRA for employers with less than 20 employees. This is not offered by every state and each state has different provisions.
  • Termination Date aka “Term date” usually refers to the last day of employment, but may also refer (in context) to benefits termination date.
  • Third Party Administrator (TPA) are companies that administer COBRA. They collect the administration fees and sometimes charge a secondary monthly fee. 
  • Unset means COBRA Complete is not the COBRA Administrator.