COBRA Law Summaries
Maryland, COBRA Law Summaries
Maryland's health care continuation law is codified in the Annotated Code of Maryland, Insurance Article, Title 15.
COVERAGE
Employers maintaining group health insurance policies issued for delivery in Maryland are affected (Ins. Code, Sec. 15-409(3), as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002). Every insurance policy issued or delivered in Maryland to an employer by an insurance company or a nonprofit health service insurance plan shall provide continuation coverage.
WHAT THE EMPLOYER MUST DO
Employers maintaining group health insurance policies issued for delivery in Maryland are affected (Ins. Code, Sec. 15-409(3), as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002). Every insurance policy issued or delivered in Maryland to an employer by an insurance company or a nonprofit health service insurance plan shall provide continuation coverage.
Persons covered under the group policy for three months prior to the termination of coverage, as well as their dependents and surviving or divorced spouses are eligible for coverage (Ins. Code, Secs. 15-407 and 15-408). Where coverage ends due to the death of the employee, surviving spouses and dependents must have been covered under the group contract for at least 30 days prior to the employee's death (Ins. Code, Secs. 15-407 and 15-408).
Continuation coverage is triggered by loss of group coverage due to involuntary termination other than for cause, voluntary termination by the employee, or the employee's death or divorce (Ins. Code, Secs. 15-407 and 15-408; and Ins. Code, Sec. 15-409, as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002). A group policy may provide for continuation of coverage after the death of the person in the insured group (Ins. Code, Sec. 15-410).
The election period for involuntarily terminated employees, surviving and divorced spouses, and dependents must begin on the date group coverage ends and end no sooner than 45 days after such date. Coverage is elected by submitting a signed election notification form to the employer during the election period (Ins. Code, Sec. 15-407(E); and Ins. Code, Sec. 15-409(e), as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002). Employers must provide election notification forms to qualified beneficiaries or their authorized representatives within 14 days of receiving a request for the form (Ins. Code, Sec. 15-407(E); Ins. Code, Sec. 15-409(e), as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002).
Extended election period for subsidy-eligible individuals. Employers and insurance carriers must allow an extended election period for continuation coverage under section 15-409 if the individual: (1) was involuntarily terminated from employment by a small employer between September 1, 2008, and February 16, 2009, inclusive, as described in the American Recovery and Reinvestment Act of 2009; (2) is an assistance eligible individual, or would be an assistance eligible individual if an election of continuation coverage under section 15-409 was in effect on February 17, 2009; and (3) was eligible for continuation coverage under section 15-409 at the time of the individual's termination of employment (Sec. 15-409.1(C), as added by S. 84, enacted and effective April 14, 2009).
The extended election period continues until 60 days after notification as required by ARRA if the notification describes the extended election period required under this section. Any continuation coverage elected by an individual during an extended election period under this section begins during the first period of coverage beginning on or after the individual's election of continuation coverage; and may not extend beyond the period of continuation coverage that would have been required under section 15-409 if the coverage had been elected as required under that section (Sec. 15-409.1(C), as added by S. 84, enacted and effective April 14, 2009).
Conversion to individual policy.- Generally, employees or members covered under a group policy or a nonprofit health service plan for three months prior to termination are eligible for coverage. Covered dependents, divorced or surviving spouses are also eligible. An individual covered by a group health insurance policy issued for delivery in Maryland that provides benefits in the event of disability is also eligible. The insurer is not required to issue a converted policy to a person who is eligible for Medicare (Secs. 15-412, 15-413 and 15-414, as added by Ch. 35 (H. 11), L. 1997).
Premiums.- The premium for the converted policy must be determined in accordance with the insurer's table of premium rates applicable to the age and class of risk of each person to be covered under that policy and to the type and amount of insurance provided (Sec. 15-413, as added by Ch. 35 (H. 11), L. 1997).
Duration of coverage.- The duration of coverage will depend upon the reason group coverage was terminated (Ins. Code, Secs. 15-407 and 15-408; and Sec. 15-409, as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002). Maryland law generally provides that continuation coverage, when triggered for any reason, must last at least six months for the insured person (Ins. Code, Sec. 15-407(C).
Coverage for involuntarily terminated employees, surviving spouses, and dependents must last for 18 months (Ins. Code, Secs. 15-407(D) and 15-408(E).
Premiums.- The premium shall be the sum of the amount that would have been contributed for the insured person's coverage by the group policyholder, plus the amount of contribution that would have been required to be paid by the insured person if group coverage had not terminated (Ins. Code, Secs. 15-407(D) and 15-408(E); and Sec. 15-409(d), as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002).
See also Conversion to individual policy, above.
Termination of coverage.- Coverage will generally terminate if the insured person fails to make a required premium payment, becomes insured under another group or individual plan, becomes eligible for Medicare, or elects to stop coverage under the group contract. Coverage for a divorced spouse will end upon remarriage (Ins. Code, Secs. 15-407(C) and 15-408(C); and Sec. 15-409(c), as amended by Ch. 409 (H. 1158), L. 2002, effective October 1, 2002).
NOTICE
Generally, persons eligible for continuation coverage must be notified of this right on or before the date or termination of coverage, but not more than 61 days before. If the insured person is not so notified, then the insured person shall have the right to apply for a continuation policy within the time stated in the notice, which shall be at least 31 days after the date of the notice, except that the late notice may not extend the period for making application beyond 90 days after the termination of group coverage (COMAR Sec. 31.11.01.16(A)).
<p>Generally, persons eligible for continuation coverage must be notified of this right on or before the date or termination of coverage, but not more than 61 days</p>