Michigan COBRA (Health Insurance Continuation) laws & HR compliance analysis

Michigan COBRA (Health Insurance Continuation): What you need to know

The federal Consolidated Omnibus Budget Reconciliation Act (COBRA) permits employees to continue their group health coverage if they leave the group for certain specified reasons. Although many states also require continued coverage in many situations, Michigan does not.
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In Michigan, employees' continuation rights are covered solely by federal law.
“Conversion” is the right to convert to an individual policy when group coverage ends. Michigan requires that conversion be offered when coverage terminates for certain reasons under a hospital, medical, surgical, or sick-care group policy if the individual had been covered for the previous three months (MI Stat. Sec. 500.3612). Events terminating coverage that trigger the right to conversion include:
• Discontinuance of a group policy in its entirety or with respect to an insured class;
• Voluntary or involuntary termination of employment except if due to gross misconduct;
• Death of the employee; and
• An event that causes an employee's spouse or dependent to cease to be a qualified family member under the group policy.
Notification of the conversion privilege must be included in each policy and certificate of coverage. Employers must give written notice to an individual eligible for conversion within 14 days after the group policy is terminated or the employee is terminated. Employees are required to notify the insurer of their election to convert to an individual conversion policy no later than 30 days after termination of coverage. The first premium is to be paid to the insurer at the time the individual elects to convert.
Last reviewed on May 15, 2017.

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