Employer Based Insurance
Most Rhode Island residents obtain health insurance through their employer or the employer of a family member on whom they are dependent.
ERISA, the Employee Retirement Income Security Act, is a federal law that sets federal reporting and disclosure rules for employer-sponsored health plans or "self-insured" health plans. Under ERISA, companies that self-insure and pay for workers' health benefits directly are exempt from state insurance laws. This means that your employer may not have to follow state laws concerning mandated benefits if they self-insure. Text of the Employee Retirement Income Security Act - 29 U.S. Code Chapter 18 (external link) for more information.
Change in Employment Status
Employers are not required to continue insurance coverage if you cease to be employed. However, you may be eligible for continuation of insurance coverage subject to federal law called COBRA Summary of Federal Law (external link) or the Rhode Island state law called mini-COBRA.
Federal Economic Stimulus Package
- Former Employees of B. A. Ballou
- Rhode Island Extended Benefits (Mini COBRA) law signed April 9, 2009
- COBRA Premium Reduction Program
Lt. Gov Robert's website (external link).
- Federal Stimulus - COBRA continuation
COBRA Eligibility
The Federal COBRA program is available to covered employees, their spouses, their former spouses, and their dependent children if they have lost employer-sponsored coverage through a company that continues to offer health insurance, does not go out of business, and has at least 20 employees. In Rhode Island, mini- COBRA extends this benefit to employees of companies with fewer than 20 employees. the Extended Medical Benefits statute, or "Mini COBRA" (external link).
Coverage must have been lost for one of the following reasons: the death of a covered employee, termination, or reduction in the hours of a covered employee's employment for reasons other than gross misconduct, divorce or legal separation from a covered employee, a covered employee's becoming entitiled to Medicare, and a child's loss of dependent status (and therefore coverage) under the plan.
Administering COBRA
Notifying an insurance carrier about the qualifying event (i.e. job loss) to begin COBRA coverage is the employee's responsibility if you lose coverage because of divorce, separation, or a child is no longer qualifying as a dependent. It is the employer's responsibility to notify the insurance carrier if the qualifying event is termination, reduction of hours, dealth, Medicare eligibility, or bankruptcy of the employer.
If the group plan you belong to through your employer consists of 50 members or less, you are responsible for paying your monthly premium directly to the insurance carrier. If your group plan consists of greater than 50 members, you are responsible for paying your montly premium to your employer direclty, or to the insurance carrier if your workplace ceases to exist.
You have at least 60 days from the date of the qualifying event to decide whether you would like to elect COBRA coverage. Your effective date will be immediately following the qualifying event to prevent a break in coverage. If you elect to continue your coverage, you are able to use COBRA for 18 month's.
Cost of COBRA
COBRA allows former employees to keep their policy, but must pay both the entire cost of the premium for thier group coverage. This includes both cost of the premium they previously paid out-of-pocket plus the share of the premium the employer previously covered. Additionally, former employees may be charged a 2% administrative fee to keep their coverage. Therefore, most people covered by COBRA may experience an increase in their health insurance premuiums compared to when they were employed. You cannot buy a different plan under COBRA from what you were offered as an employee.
2010 Updated COBRA information
Employers Options for Insurance
