COBRA & PAC Continuation Health Coverage 

The Consolidated Omnibus Budget Reconciliation Act (COBRA) health benefit provisions amend the Employee Retirement Income Security Act, the Internal Revenue Code and the Public Health Service Act to require group health plans to provide a temporary continuation of group health coverage that otherwise might be terminated.  

COBRA requires continuation coverage to be offered to covered employees, their spouses, former spouses, and dependent children when group health coverage would otherwise be lost due to certain specific events. COBRA continuation coverage typically costs an employee’s full premium (both the employee’s share, and the employer’s share), plus a 2% administrative fee. 

Employers with 20 or more employees who offer group health insurance must offer COBRA. This includes private-sector employers, and most state and local governments. 

It’s important to comply with COBRA requirements. Failure to comply can lead to:  

• IRS excise taxes of up to $100 per day per affected person (or $200 per day if more than one family member is affected). These fines can continue until violations are corrected. 

• Department of Labor (DOL) penalties for every day an employer fails to provide the required COBRA notices to employees. 

• Employee or dependent lawsuits against the employer or plan administrator for coverage losses, out-of-pocket medical expenses, attorney’s fees, and other damages. 

• Plan audits and investigations from the IRS or DOL. 

To offer solutions that ensure compliance with COBRA requirements, contact sales@pnihcm.com. 

COBRA is not the only way to offer continued health coverage to employees. Portable Alternative Coverage, powered by When, is an innovative program from isolved that gives employers a modern alternative to COBRA for former employees who lose health coverage.  
 

PAC provides the AI-driven marketplace and coverage alternatives that lower cost and risk.   

For more information, contact sales@pnihcm.com. 

Portable Alternative Coverage, powered by When, is an innovative program from isolved that gives employers a modern alternative to COBRA for former employees who lose health coverage.   

It uses an AI-driven marketplace and 24/7 licensed support to guide those employees toward affordable, individualized health plans — including ACA, private, and short-term options — that they can take with them wherever they go. 

Alumni Advisory Services (AAS), powered by When and delivered through isolved, is an enhanced post-employment solution that builds on the foundation of COBRA administration and Portable Alternative Coverage (PAC).  
 

AAS depends on the data, workflows, and health coverage options that come from COBRA and PAC, and adds the human and advisory layers that make for a better experience — personalized support, proactive engagement, and alumni relationship management.   

Consider AAS white-glove concierge service that reduces anxiety and confusion for departing employees, offers personalized expert guidance and custom coverage comparisons, and less risk. 

For more information, contact sales@pnihcm.com. 

Employees who lose coverage due to a qualifying event – and their spouses and dependent children – may be entitled to continuation coverage under COBRA. Qualifying events include: 

• Voluntary or involuntary job loss (except for gross misconduct) 

• Reduction in work hours 

• Divorce or legal separation 

• Death of the covered employee 

• Dependent child aging out of coverage