Pennsylvania’s “Mini-COBRA” law has now been in effect for almost a year.  The Mini-COBRA legislation signed by Governor Rendell back in June 2009 extends to small employers not covered by federal COBRA regulations the responsibility to offer separated employees the opportunity to purchase up to nine months of extended coverage on the employer’s plan.  Failure to notify separated employees of the availability of the benefit may result in penalties and possible damages if a loss of coverage results in unpaid medical bills.  (Please read my earlier blog entitled COBRA Mistakes Can Be Costly!).

Pennsylvania’s Mini-COBRA applies to all businesses with 2 to 19 employees who already provide group health insurance.  It does not require small businesses who do not currently provide health insurance to their employees to offer a group health plan.  Here are some of the distinctions between the PA Mini-COBRA and existing federal COBRA:

PA Mini-COBRA

Applies to employers with 2 – 19 employees

Provides 9 months continuation coverage

Insured must have been enrolled for at least 3 months

Applies only to group health plans through third party  insurance companies

Employer may charge up to 105% of group rate

Employer must give COBRA notice within 30 days

Federal COBRA

Applies to employers with 20+ employees

Provides 18 months continuation coverage in most case and 36 months in special circumstances

Insured must be covered on day of qualifying event

Applies to self-insured group health plans as well as plans insured through third party insurance companies

Employer may charge up to 102% of group rate

Employer must give COBRA notice within 15 days

The 65% premium reduction provided for under the federal stimulus bill has expired.  Employees selecting the continuation coverage must pay the full premium.