Why Does It Matter Who Regulates My Plan?
Knowing who regulates your plan is important if you undergo a change in your life that threatens your coverage. The Consolidated Omnibus Budget Reconciliation Act of 1985 (or COBRA) is a federal law that helps many people on federally regulated plans keep their coverage for certain periods in such situations. However, some states have laws that dictate their own rules for continued coverage. These laws can be friendlier to employees in some cases, and less beneficial in others. If you are an employer, consider which option will be most cost-effective for your business. Learn your state laws, and determine whether self-funding will help you save money or cost you more.
Knowing who regulates your plan and how that can affect your coverage is a critical part of being prepared for unexpected circumstances, so it’s always useful to learn as much as possible. Find out whether your group coverage is self-funded or fully insured, and you’ll be a step closer to understanding your rights.
