COBRA (Consolidated Omnibus Budget Reconciliation Act)

What it is: A federal law that gives employees the option to continue their health insurance coverage after leaving a job—usually at 100% of the cost, plus a 2% admin fee.

Common uses:

• Allowing terminated employees or retirees to continue employer coverage temporarily

• Covering dependents during gaps in care

• Giving time for employees to transition to new plans after job changes

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What people get wrong:

• Forgetting the tight timelines—employees typically only have 60 days to elect COBRA and 45 days to make the first payment.

• Not realizing COBRA can be retroactive to the date of loss, which can confuse employees who didn’t elect it right away.

• Believing COBRA is always the best option—it often isn’t, especially if the individual qualifies for a marketplace subsidy.

⚠️ Pro tip: For lower-income employees or those losing employer coverage, ACA plans may be far cheaper than COBRA, especially with premium subsidies. We often help clients compare options before they elect.

Final Thoughts: The Right Fit Comes from Strategy, Not Buzzwords

These tools—VEBA, QSEHRA, and COBRA—aren’t one-size-fits-all. But when used correctly, they can be powerful, cost-effective ways to extend support to employees or retirees without overcommitting your budget.

At S+H Benefit Solutions, we don’t just tell you what’s available—we walk you through what fits, what doesn’t, and how to communicate it clearly to your team.

Ready to review what’s working (and what’s not) in your current setup? Let’s talk.