Under COBRA, when a dependent child ages out of eligibility under a parent's group health plan, the child may continue group coverage for:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
COBRA, the Consolidated Omnibus Budget Reconciliation Act, entitles qualified beneficiaries to continue group health coverage after a qualifying event. For a dependent child who loses coverage because he or she exceeds the plan's age limit, the aging-out event, the continuation period is 36 months. This compares with the general 18-month continuation available to covered employees after termination of employment or reduction of hours. The 36-month period protects dependents who would otherwise be left uninsured at a critical transition age, and the beneficiary must pay the full premium plus an administrative charge to keep the coverage in force.
Why the other options are wrong
- B) Eighteen months is the standard COBRA period for an employee's termination of employment or reduction of hours; the dependent's loss of eligibility due to exceeding the plan's age limit is a qualifying event with the longer, 36-month period.
- C) Twelve months is not a COBRA continuation period for any standard qualifying event, so it cannot be the correct duration for an aging-out dependent.
- D) Six months is not a COBRA continuation period under the federal continuation rules and is far too short for the aging-out event.
Memory hook
Aging out = 36 months of safety. Quitting the job = 18 months. The child past the age cap gets the longer runway.