What does COBRA provide for?

• A. Free emergency care for all employees.
• B. Continued health care coverage for employees and their families after events that would end coverage under ordinary circumstances.
• C. Cash severance upon termination.
• D. Automatic health coverage for new jobs.

Answer: (B)

COBRA provides continued health care coverage for employees and their families after events that would end coverage under ordinary circumstances. This means that when a qualifying event occurs—such as job loss (including being laid off or quitting), a reduction in hours, death of the employee, divorce or legal separation, or a dependent no longer meeting the plan’s eligibility—the former employee and eligible family members can keep the employer’s health plan by paying the premium. It isn’t free emergency care for everyone, it doesn’t provide cash severance, and it doesn’t automatically provide health coverage when starting a new job. The continuation is for a limited period, typically up to 18 months, with some situations allowing longer extensions.