In Delaware, small companies must offer COBRA coverage to laid-off workers

    A new Delaware law may help newly unemployed people hold on to their health insurance.

    The federal Consolidated Omnibus Budget Reconciliation Act rule requires larger employers with 20 or more workers to offer group rates to laid-off workers. The new Delaware rule gives that option to employees who work for a smaller company.

    The mini-COBRA rule lets laid-off workers purchase health coverage at lower negotiated prices.

    Gene Reed, Delaware’s chief deputy insurance commissioner, said workers pay their own share plus the premium previously paid by their former company — in addition to a 2 percent administrative cost.

    Reed said COBRA coverage is not cheap, but often less expensive that insurance available in the private, individual market.

    Bob Older, with the Delaware Small Business Chamber, says it will take some time for the word to get out.

    “I wanna make sure that all of our member companies know there are a lot of things they are going to have to follow and do correctly, and I’m hoping there’s somewhat of a learning curve for everybody,” Older said.

    Reed said Delaware’s unemployment rate hovers around 7 percent, so the mini-COBRA law could help thousands.

    Gov. Jack Markell signed the law on May 22. It will go into effect June 21.

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