Is StretchDollar's health benefit plan subject to COBRA and ERISA?

COBRA applies to group health plans offered by employers with 20 or more employees in the last calendar year. If you had fewer than 20 employees, COBRA does not apply. However, in some cases, state continuation coverage requirements may apply. Best to check your state’s specific continuation coverage requirements to be sure you're in compliance. 

StretchDollar health benefits are group health plans, which are subject to ERISA. We help ensure ERISA compliance by generating and sharing a comprehensive Summary Plan Description about your StretchDollar benefits plan with your employees. This document is available to all employees in the Documents tab of their Benefits Portal. As long as  this information is provided to your employees and you refrain from actively assisting them in plan selection, you're in good standing with ERISA regulations.

What is COBRA?

COBRA is short for the Consolidated Omnibus Budget Reconciliation Act. It's a federal law that allows employees tp keep buying your group health insurance for up to 18 months if they lose their job or their coverage ends, as long as they work for a company with 20 or more employees. In some cases, you can extend that coverage up to 29 or 36 months.

What is ERISA?

ERISA is short for the Employee Retirement Income Security Act. The U.S. Department of Labor tells us it sets the basic rules for retirement and health plans in the private sector, making sure folks in these plans are protected.

What kind of protections does ERISA offer? Mostly, it's about your health and retirement benefits. In the case of your StretchDollar health plan, it means your company has to be clear about what your health plan includes while also laying down the rules for joining the plan, such as how long you need to work before you can sign up.