Loss of Subsidized COBRA — A Special Enrollment Period?

 

A Special Enrollment Period allows someone to change healthcare coverage outside of a normal enrollment cycle. In the individual market, when the reforms of the Affordable Care Act took effect in 2014, if one elected COBRA (temporary extension of group coverage) they were locked into the COBRA coverage until the next annual open enrollment period or until the end of COBRA. We recently learned that several years later, states served by the federal exchange, healthcare.gov, benefitted from the quiet addition of a new Special Enrollment Period created by the end of a former employer subsidizing COBRA. This gives an individual the right to go to the individual market after their employer subsidy ends without waiting until the next annual open enrollment. This right is clearly stated on the healthcare.gov site.

We now know that both New York and Connecticut also allow the end of subsidized COBRA as a Special Enrollment although this information is not to be found on either state’s exchange web site, New York State of Health or Access Health CT. We suspect other state-based exchanges like California and Massachusetts may also allow it. However, we have been less successful in our attempts to determine exactly when these changes were made and why they were made with virtually no publicity. The language in federal guidelines has not changed to explicitly indicate this new special enrollment period, so it seems some state regulators feel their state’s language as well as the federal language is somewhat inconsistent with this change in direction. Nevertheless, a generous and practical course seems to have been taken to avoid the awkward situation where individuals in the country served by the federal site, healthcare.gov, have access to this Special Enrollment while those in states with state-based exchanges would not.

All this to say, that while it seems at this time that the end of subsidized COBRA is a qualifying event for a special enrollment into a marketplace plan, we cannot be certain that this language will not disappear from healthcare.gov or state exchange sites as quietly and without fanfare as it arrived.

For now, however, with so much job loss occurring and having occurred, it is critically important that people be aware of their coverage and enrollment options. If you know someone whose employer subsidization of COBRA is ending, make sure they know to check on the availability of this Special Enrollment Period in their state.