Ask the HR Expert: COBRA Rate Increases

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Question: We understand COBRA rates can only be increased once every 12 months. How is the 12-month period determined?

Answer: The determination period is any 12-month period selected by the plan as long as it is applied consistently from year to year. For ease of administration, most employers choose the plan year as their 12-month period. 

For instance, for a calendar-year plan, the first day of the 12-month period is January 1, which conveniently is also the date that open enrollment choices and insurance renewal rates take effect.


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COBRA rates must be fixed in advance. Rates cannot be increased after the 12-month determination period starts, although there are three exceptions to this rule. The exceptions are:

  • The plan previously charged less than 102 percent of the premium and the new rate does not exceed 102 percent of the premium; 
  • The COBRA participant qualifies for the disability extension period and the new rate does not exceed 150 percent of the premium; or 
  • The COBRA participant changes their election, such as changing from single to family coverage in connection with family status change. 

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Sherri Bennett

Written by Sherri Bennett