ERISA Benefits Law Desk ReferenceERISA Benefits Tech, LLC

Part 13 · Chapter 1

COBRA Continuation Coverage

Law stated as of October 3, 2026 · COBRA, HIPAA, and Welfare Benefits

Scope and status

Verify deadlines, indexed premium/penalty figures, and current model notices before relying on them.

Citations are to primary authority (Code §4980B and the IRS regulations at 26 C.F.R. §§54.4980B-1 through -10; ERISA §§601–608 and the DOL notice rules at 29 C.F.R. §§2590.606-1 through -4). The core IRS COBRA regulations (T.D. 8812, 1999; T.D. 8928, 2001) generally govern ERISA Title I COBRA as well, except where ERISA's statutory text differs. Final reg: 26 C.F.R. §54.4980B-1, Q&A-1. Always pair the federal analysis with state continuation law (Part F).

Sections

Part A is shown in full. The other sections are listed by title; their text is available to subscribers.

Part A — Coverage and Applicability

A1.Which employers are subject to COBRA

Part 13, ch. 1, § A1

COBRA applies to a group health plan maintained by an employer that had 20 or more employees on more than 50% of its typical business days in the preceding calendar year. Statute: Code §4980B(d); ERISA §601. Church plans and governmental plans are exempt from federal COBRA (governmental plans are instead subject to the parallel PHSA continuation rules). Statute: Code §4980B(d)(2)–(3).

A2.Counting employees (including fractional and non-common-law workers)

Part 13, ch. 1, § A2

For the 20-employee test, count all individuals employed on a typical business day, including part-time employees counted as fractions (each part-timer counts as a fraction equal to hours worked over the hours required for full-time status), but only common-law employees count; self-employed individuals, independent contractors, agents, and directors are not counted, even if eligible for the plan. Final reg: 26 C.F.R. §54.4980B-2, Q&A-5.

A3.What is a "group health plan" subject to COBRA — and what is excepted

Part 13, ch. 1, § A3

COBRA reaches employer-sponsored group health plans providing medical care: indemnity plans, HMOs/PPOs, health FSAs and other cafeteria-plan health components, drug/alcohol-treatment programs, on-site clinics that provide more than first aid, wellness programs that provide medical care, and dental/vision. Statute: Code §4980B(g)(2); Final reg: 26 C.F.R. §54.4980B-2, Q&A-1. Excepted: HSAs and Archer MSAs (the account itself; the underlying HDHP is still a covered plan), and benefits that are not "medical care." Health FSAs get a limited COBRA obligation (a health FSA need not offer COBRA beyond the end of the plan year of the qualifying event if the FSA is an excepted benefit and the maximum COBRA premium for the year equals or exceeds the maximum benefit available). Final reg: 26 C.F.R. §54.4980B-2, Q&A-8.

Part B — Qualified Beneficiaries and Qualifying Events

  1. B1Qualified beneficiariesSubscribers
  2. B2The qualifying events and the coverage period each triggersSubscribers
  3. B3Leaves, Medicare, and the FMLA/USERRA boundariesSubscribers

Part C — Notice Architecture and Deadlines

  1. C1The general (initial) noticeSubscribers
  2. C2The employer-to-administrator and administrator-to-QB chainSubscribers
  3. C3The participant-to-administrator notice (60 days)Subscribers

Part D — Election, Premiums, and Duration

  1. D1The election periodSubscribers
  2. D2Premiums — amount, timing, and the shortfall rulesSubscribers
  3. D3Duration extensions and early terminationSubscribers

Part E — COBRA in Mergers and Acquisitions

  1. E1The stock-vs-asset distinction frames everythingSubscribers
  2. E2The three beneficiary groupsSubscribers
  3. E3Whether the transaction is itself a qualifying eventSubscribers
  4. E4Which entity is responsibleSubscribers
  5. E5Contractual allocation and its limitsSubscribers

Part F — State Continuation Coverage

  1. F1Arizona mini-COBRA and state continuationSubscribers

Part G — Penalties and Correction

  1. G1The dual penalty exposureSubscribers
  2. G2CorrectionSubscribers

The first Part of each chapter is open to everyone. The remaining sections, with their authority and practice points, are available to subscribers and to clients of ERISA Benefits Law Group, PLLC whose engagement includes access.

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