Ohio Department of Insurance Explains How Ohio’s Newly-Amended Mini-COBRA Coordinates with Federal Stimulus Act.

Last week, the Ohio Department of Insurance issued guidelines about how employees of small employers (i.e., 20 or fewer employees) who are involuntarily terminated may qualify for continued health insurance that is 65% subsidized by the federal government. Governor Strickland signed legislation which amended Ohio’s mini-COBRA (at Ohio Revised Code §3923.38 and §1751.53) and will affect health insurance policies issued or renewed for small employers after April 1, 2009. Among other changes, the statute extends the continuation period from six months to one year. The Department of Insurance also includes model notices on its website which all small employers and non-ERISA self-insured employers must use to notify laid off and other involuntarily terminated employees of their rights under the American Recovery and Reinvestment Act (“ARRA”) to continue their health insurance with 65% of the cost subsidized by the federal government. Insurers are also required to notify employees receiving continuation coverage since February 17 of their ARRA rights.

Unlike the subsidized COBRA continuation under the ARRA, under Ohio’s mini-COBRA, small employers are not required to front 65% of the insurance premium; rather, the insurance company will handle the former employee’s continuation payments and also receive the tax credits. Also unlike the federal ARRA, employees of small Ohio employers do not get a free “do-over” or extended eligibility period if they failed to elect continuation coverage within the deadlines right after they were terminated.

Insomniacs may read the full Department of Insurance revised guidelines at http://www.ohioinsurance.gov/ConsumServ/COBRAStimulusSmallEmployers.pdf. The DOI’s model form can be accessed at http://www.ohioinsurance.gov/ConsumServ/COBRAContinuationCoverageElectionNotice.doc. Other information about ARRA and Ohio’s mini-COBRA law are available at http://www.ohioinsurance.gov/ConsumServ/COBRA.htm.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.