Attention small businesses and insurers of small businesses in Pennsylvania: Mini-COBRA
On June 10, 2009, the Governor of Pennsylvania passed what is being referred to as Mini-COBRA, a statute which requires small businesses (2-19 employees) to provide up to 9 months of continuing health benefits under guidelines similar to the federal COBRA statute. Employees and their dependents are eligible. Prior to Mini-COBRA, only those employees who worked for companies who employed more than 20 people were eligible for federal COBRA benefits. These benefits extend health coverage under the employer’s insurance plan. Any employees whose group coverage terminates on or after July 10, 2009, are eligible for Mini-COBRA.
An employee who is eligible for Mini-COBRA coverage may not be denied on the basis that of lack of insurability due to a serious illness. However, if an employee is on Mini-COBRA but becomes eligible for Medicare or another group plan, that employee is no longer eligible for Mini-COBRA. When an employee’s health coverage ends due to a “qualifying event”, the employer must provide notice to the covered employee and the insurance company within 30 days from that date. There are no specific penalties laid out in the Mini-COBRA law. However, any person or entity that violates Mini-COBRA, it subject to the penalties set forth in the Pennsylvania insurance laws. Employers also may be subject to additional penalties by the Department of Labor & Industry or by the Federal Department of Labor.
Insurance companies were to notify policyholders (employers) of this new law within 45 days of the effective date, or by August 24, 2009.
Please contact Crystal H. Clark at (717) 237-7103 or cclark@tthlaw.com with any questions.