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COBRA: Why It’s So Expensive and How Alpine Helps Administer It

COBRA: Why It’s So Expensive and How Alpine Helps Administer It

A long list of stressors comes with losing a job, including losing employer-sponsored health insurance. When an employee receives their COBRA packet following termination, the question often arises —why is COBRA coverage so expensive? 

Read on to find out why the cost is expensive and how your organization can support employees through the process of signing up for COBRA using Alpine, a third-party administrator that helps small & mid-sized businesses manage their employee benefits and COBRA.

 

What Is COBRA, and Are All Employers Required to Offer It?

The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a set of laws put into place by the Department of Labor (DOL) to protect employees from the possibility of losing health insurance coverage when losing their job.

However, not every organization is required to offer COBRA. Employers with a group health plan and 20 or more full-time employees must offer a continuation of group health insurance coverage to qualified beneficiaries for 18 months, or 29 with a disability extension.

 

 

Why COBRA Is So Expensive

COBRA extends group health insurance to the recently unemployed and their families for a brief window.

While it can often come as a surprise to those who have never enrolled in COBRA, the health plan offered to them through COBRA is the exact same plan offered by their employer. Though it’s the same plan, it is often significantly more expensive due to the employer no longer contributing a portion of the premium. 

COBRA pricing can seem daunting at first glance for employees, and it’s important to effectively communicate with them why it’s this way.

 

 

How Alpine Simplifies COBRA Administration

When administering COBRA, there are many moving pieces to ensure your organization is following existing guidelines. Alpine simplifies continued coverage while ensuring your organization remains compliant with state and federal laws throughout the entire employee lifecycle.

When an employee is terminated in BerniePortal, Alpine gets notified to begin the COBRA process. Though employers are legally required to send a specific rights notice to a terminated employee within two weeks, Alpine goes above and beyond by ensuring notices get sent within seven days of termination in BerniePortal. However, employees can enroll in COBRA benefits using their same BerniePortal login anytime after their coverage is terminated.

Alpine does the heavy lifting for your organization by communicating benefit options to COBRA enrollees during open enrollment and tackling the hurdles of collecting payments. 95% of COBRA members enrolled with Alpine pay via recurring ACH, which means your organization gets reimbursed for premiums faster and more consistently. 

To further promote transparency, your organization can pull reports within BerniePortal that include eligibility, payment details, and paid through dates for each COBRA enrollee.

Connect with an Alpine expert to start streamlining your COBRA administration today.

 

Additional Resources

You can stay informed, educated, and up-to-date with important HR topics using BerniePortal’s comprehensive resources:

  • BerniePortal Blog—a one-stop-shop for HR industry news
  • HR Glossary—featuring the most common HR terms, acronyms, and compliance
  • HR Guides—essential pillars, covering an extensive list of comprehensive HR topics
  • BernieU—free online HR courses, approved for SHRM and HRCI recertification credit
  • HR Party of One—our popular YouTube series and podcast, covering emerging HR trends and enduring HR topics

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