Under what conditions can COBRA rates be increased?

Get Legal Help Today

 Secured with SHA-256 Encryption

Under what conditions can COBRA rates be increased?

Our county school board has a self-funded health plan. In 2010, they increased COBRA rates and retiree rates only. They did not increase the costs to current/active employees. Is this legal? Seems to circumvent the federal COBRA laws/intent.

Asked on February 23, 2011 under Employment Labor Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Under COBRA, former employees have the right to continue their health insurance at essentially the same rates as current employees receive. Note the following:

1) The former employee receiving health care via COBRA can be made to pay the entire premium, rather than only the employee porton--i.e. while the employee gets the benefit of the group rate, the employer does not have to subsidize him or her.

2)  It appears that a small premium (2%) can be charged over the group rate, for the administrative costs.

3) While rates are typically fixed for 12 months at a time, they can increase as the plan costs increase.

Here is a link to a Dept. of Labor FAQ sheet that you may find informative: http://www.dol.gov/ebsa/faqs/faq_consumer_cobra.HTML


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption