Most employers are familiar with the federal COBRA law. However, many may not be aware that most states have also passed their own version of COBRA, popularly called mini-COBRA laws. While many of these laws are similar to federal COBRA, there can be important differences.

What employers have to comply with Arizona mini-COBRA?

 

Arizona mini-COBRA applies to employers with one to 20 employees that are not covered by federal COBRA. The law applies to all group health plans.

What are the qualifying events?

 

Arizona mini-COBRA qualifying events are similar to federal COBRA and include:

  • Voluntary or involuntary termination of employment (except for gross misconduct or reduction of hours)
  • Death of the employee
  • Divorce or legal separation of an employee from their spouse
  • Loss of dependent status by an enrolled dependent
  • Loss of dependent coverage because the employee is entitled to Medicare

Coverage typically lasts for 18 months. If the employee received continuation coverage because of a voluntary or involuntary termination of employment, but then experiences another qualifying event during their 18 months of coverage, continuation coverage should continue for an additional 18 months. If the qualified beneficiary becomes disabled during their first 18 months of continuation coverage, that coverage should be extended an additional 11 months.

Who is a qualified beneficiary?

 

A qualified beneficiary is an employee who was covered by the employer’s plan for at least three months before a qualifying event. A qualified dependent is a spouse or dependent child of the employee who is covered under the plan immediately before a qualifying event. Qualified beneficiaries cannot be charged more than 105 percent of the applicable rate for similarly situated individuals.

Are there notice requirements?

 

The employer must provide a timely written notice of an employee’s qualifying event to the health plan. The health plan will then provide the employee and their dependents with a written notice of their continuation coverage rights. Qualified beneficiaries have 60-days to enroll.