If you run a small business and offer health insurance, staying COBRA compliant is one of those things that might seem tricky at first — but with a little help, it becomes much more manageable. COBRA, which stands for the Consolidated Omnibus Budget Reconciliation Act, gives employees and their families the right to keep their health benefits after leaving a job, usually for up to 18 months.

Here’s a simple, step-by-step guide to help small businesses stay on the right track. It’s not about being perfect; it’s about knowing your responsibilities and keeping things organized. A helpful resource for finding COBRA administration support is https://employeebenefitscompanies.com/cobra-administration/. They offer tools and services that can make this process easier.

Step 1: Know if COBRA Applies to You
COBRA applies to businesses with 20 or more employees. If you're a smaller business, check your state laws—some states have similar rules that apply to smaller companies.

Step 2: Understand the COBRA Events
COBRA coverage kicks in after certain life events. These include things like voluntary or involuntary job loss (except if there’s gross misconduct), reduction in work hours, divorce, or death of the covered employee.

Step 3: Provide the Initial Notice
When someone signs up for your health plan, they should get a COBRA general notice. This tells them their COBRA rights. You can usually get this from your insurance provider or a COBRA administration service.

Step 4: Send the Election Notice After a Qualifying Event
If someone loses coverage due to a qualifying event, you need to send them a COBRA election notice within 14 days of being told about the event. This explains how they can continue their coverage.

Step 5: Keep Good Records
Document everything—when you send notices, when you’re notified about a qualifying event, and any communication with former employees. This helps in case there are any questions later.

Step 6: Stay Current on Premiums and Deadlines
Make sure you collect or help coordinate payments for the COBRA premiums. Former employees usually pay the full premium themselves, plus a small fee.

Step 7: Get Help if You Need It
Handling COBRA can take time and attention. If it feels like too much or if you’re not sure about any part of it, working with a third-party administrator can really help.

By breaking it into steps and staying organized, COBRA compliance doesn’t have to be a burden. Keep good records, provide the right notices, and don’t be afraid to ask for help. You’ve got this!

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Pub: 13 Aug 2025 08:19 UTC

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