From the Hotline: USERRA and COBRA
Question: How does USERRA protect an employee when he or she leaves to serve in the military, and when does COBRA eligibility start? Is there an extra 30 days under the employer’s active plan?
Answer: The Uniformed Services Employment and Reemployment Rights Act (USERRA) provides for health benefit continuation for employees who are absent from work to serve in the military, even when the Consolidated Omnibus Budget Reconciliation Act (COBRA) does not cover the employer. Under USERRA, all employer-sponsored health care plans are required to provide COBRA-type coverage for up to 24 months after the employee’s absence begins due to military service or for the period of uniformed service. Specifically, the maximum period of coverage for such an employee and their dependents is the lesser of 24 months beginning on the date the employee’s absence began or the day after the date on which the employee failed to apply for or return to a position of employment. Additionally, employees or dependents who elect this coverage may be required to pay a premium similar to COBRA (no more than 100 percent of the full premium under the plan, plus 2 percent for administrative cost for a total of 102 percent). However, a person who performs military service for less than 31 days may not be required to pay more than the employee share, if any, for such coverage.
Upon re-employment, employees and their dependents are entitled to restoration of the coverage they had prior to their uniformed service leave. Employers are prohibited from imposing exclusions and waiting periods, such as for pre-existing conditions, except for injuries or illnesses found to be service-related by the Veterans’ Administration.