Spouse's Insurance vs COBRA contingency plan for one month?

[ID Doc]

I finish my fellowship on June 30th, start my attending position in mid/late July, and I'm eligible for health insurance through my new employer starting August 1st. My family (wife + 2 kids) are covered under my health insurance now, which will expire on June 30th. The health insurance through my new employer will be a better option for us than that available through my wife's employer, so we will be going with that once eligible on August 1st.

So, what to do for July? I was planning to switch to insurance through my wife's employer for July, then switch again once I'm eligible through mine on August 1st. However, I just learned after listening to the most recent WCI podcast that COBRA can be enacted retroactively. None of us are expecting any healthcare needs in July. Thus, I suppose another option would be to do nothing for July with the contingency plan of electing COBRA retroactively if any unforeseen health issues/costs arise. From what I've read, you need to be without insurance for > 3 months to incur penalties under the ACA, so if no healthcare needs arise in July, then I think we should be ok from that standpoint.

Has anyone been in a similar situation? Any thoughts on what you did or what I should do? Any input would be greatly appreciated.

[jfoxcpacfp]

You are correct. COBRA can be instated retroactively and, with only 1 month gap, you should be in a perfect position to take advantage of this loophole.

Should be? You need to ensure that your current employer falls under the COBRA rules. If, by some stretch of the imagination, your employer did not have at least 20 qualifying employees on the payroll, you would not be eligible for coverage under COBRA.

[ID Doc]

Thanks! My current employer has thousands of employees, so I think I should be ok. Plus, they already sent us an "End of Benefits" letter that said we could continue benefits through COBRA at our own cost. It said COBRA enrollment paperwork would be mailed once I am no longer active with my current employer. I'm guessing that means mailed after June 30th. Is this paperwork pretty standard? Any reason for me to reach out to benefits now to try to see if I can look things over before that?

[jfoxcpacfp]

Yes, the paperwork should be boilerplate (standard). Don't see any downside to asking your benefits department for more information. Seems perfectly natural to me.

[ID Doc]

Thanks, will do. Thanks so much again for your input!

[q-school]

that's how it worked for us

1 mo freebie since you could enroll 1 mo retroactively.

 

[ID Doc]

Thanks for sharing the experience that it worked for you. Leaning toward going this route - will save a relatively small amount of dollars but probably a fair amount of hassle for us.