Insurer must reinstate wrongly-terminated COBRA coverage

Insurers in New York cannot automatically terminate COBRA coverage just because individuals' federal COBRA subsidies are expiring, according to the Syracuse Post-Standard. Accordingly, New York's Insurance Department ordered Group Health Inc. to reinstate coverage for an individual whose coverage was mistakenly terminated when the state's COBRA continuation coverage expired after 15 months.


The issue arose when a consumer contacted the insurance department, complaining that his insurer, Group Health, terminated his coverage. He said the insurer told him he would have to reapply for COBRA since his subsidy assistance had ended, reports Insurance and Financial Advisor.

The department directed Group Health to offer to restore the coverage. Although consumers must pay the full cost of the premium without subsidy assistance, they do not have to reapply for COBRA/New York continuation coverage, according to the insurance department.

State insurance regulators said residents are entitled to 36 months of "seamless" COBRA/New York State continuation coverage even though the federal stimulus subsidy that helps them pay for insurance expires sooner.

"Eligible consumers don't have to reapply for COBRA when the subsidy ends. They can continue coverage by electing to pay the cost of the premium," Insurance Superintendent James Wrynn said in a statement.

To learn more:
- read the Post-Standard story
- see the Insurance and Financial Advisor article
- read the New York insurance department statement