COBRA created a federal right to continued health coverage after certain job losses and other qualifying events.
The Consolidated Omnibus Budget Reconciliation Act of 1985 included provisions allowing eligible workers and family members to continue participating in an employer-sponsored group health plan for a limited period after coverage would otherwise end.
COBRA continuation coverage is generally paid by the former employee or another qualified beneficiary, rather than being free employer-provided insurance. The beneficiary may also have to pay an administrative fee, subject to statutory limits.
The law is related to employment but is not a wage statute. It is commonly confused with the WARN Act, which concerns advance notice of major layoffs and plant closures. ERISA, another major U.S. benefits law, regulates employee benefit plans but is not the name of the continuation-coverage provision itself.