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History of COBRA's evolution

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COBRA changes

The need for the COBRA safety net will shrink dramatically next year when lower- and middle-income COBRA beneficiaries will become eligible for federal premium subsidies to buy coverage through public insurance exchanges. Due to those subsidies, exchange coverage will be much less costly — by thousands of dollars in many cases — than COBRA, in which beneficiaries pay a premium equal to 102% of the group rate for coverage employers provide to active employees. That new coverage alternative is only one of many changes affecting COBRA beneficiaries and employers since the passage of the Consolidated Omnibus Budget Reconciliation Act in 1986 that requires employers to extend health coverage to employees when they quit or are laid off and to spouses due to death, divorce or marital separation. Those changes are detailed here.