Everything You Ever Wanted to Know About N.J. Continuation Coverage

If you have recently lost your health insurance coverage because you were laid-off or have quit, you have the option to continue your coverage via NJ Continuation or COBRA.

If the company you worked for had less than 20 employees for more than 50% of year in the previous calendar year, than you are eligible for NJ Continuation rather than COBRA.

 

Qualifying for NJ Continuation – a list of qualifying events

  • You must be terminated for a reason “other than for cause”
  • Your hours have been reduced to less than 25 per week, making you part-time.
  • Death of the employee – dependents may continue
  • Dependent child ages off plan – older than 26

 

Who is eligible to continue coverage?

Typically, anyone who was covered by the plan prior to the loss of coverage including all dependents.

 

How long may you continue your coverage?

  • Normal Termination: Up to 18 months
  • For death of primary card holder : Dependents may continue up to 36 months.
  • Divorce: Spouses that lose coverage through a divorce may continue up to 36 months.
  • Disability: Employees deemed disabled under the Social Security Act may continue up to 29 months.

 

Cost

Employees are responsible for 100% of the premium and employers may charge an additional 2% administrative fee. For disabled employees, employers may charge up to 150% of the premium.

When enrolling, the employee has up to 30 days to make first premium payment after notifying the employer they would like to continue the coverage.

 

When does the coverage end?

There are a few ways the coverage can end.

  1. Employer terminates all the health plans offered.
  2. Continuing subscriber requests termination
  3. Subscriber fails to make timely premium payment
  4. Subscriber exhausts the time allotted to continue(18,29 or 36 mos)

 

Notes For Employers

  • Employers must notify employees of their right to continue coverage but not required to notify dependents.
  • The employer cannot require the first premium payment be made immediately. Employee has up to 30 days to make first payment.

Notes for Employees

  • You must notify your prior employer you would like to continue coverage within 30 days of receiving your continuation paperwork.
  • You must make your first premium payment within 30 days of notifying that you will be continuing coverage.
  • Each month you must make a timely payment and not exceed your 30 day grace period payment window.
  • Premium payments should be made directly the employer and not to the carrier.

Additional Resources

If you have any questions regarding NJ Continuation please contact me directly and I will do my best to assist you.

Additional information from the State DOBI can be found here.

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About Mike Sheeran

Mike has been working in New Jersey Health Insurance marketplace for the past 8 years and is currently an account executive at Glenn Insurance, Inc in Absecon, NJ.

With his experience, he helps NJ based businesses and individuals with their life, health and other insurance needs.

Contact Mike to learn how a health reimbursement arrangement can save your business up to 30% on your group health premiums.
Mike Sheeran