If you’re exempt from federal COBRA rules, you might think you don’t have to worry about compliance. But are you forgetting mini-COBRAs? Just like a COBRA snake, these rules can sneak up on you to deliver a powerful bite.


The Consolidated Omnibus Budget Reconciliation Act of 1985, or COBRA, is a federal law that requires employers to provide continued health care coverage after qualifying events. According to the Department of Labor:

  • COBRA applies only to employers with at least 20 employees. It does not apply to church organizations or plans sponsored by the federal government.
  • Depending on the type of triggering event, continued coverage will last for a period of either 18 or 36 months. For job loss and reduction of hours, continued coverage lasts for 18 months.
  • Beneficiaries can be charged full premium costs plus a 2 percent administration fee.

Employers must follow these rules regardless of which state or states they operate in. However, in addition to these federal regulations, many employers must also comply with state rules. Often called mini-COBRAs, these state rules can create additional requirements. Common differences include the following:

  • Employers considered exempt from federal COBRA rules may be required to comply with mini-COBRAs. For example, state laws often require companies with fewer than 20 employees to offer continued coverage.
  • The period of continued coverage may be different. For examples, states may establish a shorter period of coverage for organizations with fewer than 20 employees.
  • The allowable charges may be different. For example, states may allow companies with fewer than 20 employees to charge larger administration fees – or no administration fee at all.

Complying with Mini-COBRAs

To find a state’s mini-COBRA laws, check with the state department of insurance. Not all states have mini-COBRA laws, but most do.

Following mini-COBRAs can be more complicated than following federal COBRA regulations for a couple of reasons. First, employers operating in multiple states will have to deal with multiple mini-COBRAs, all varying in numerous details.

Second, states may modify their mini-COBRA rules or create new ones. A company that has been exempt from federal COBRA rules may suddenly find itself subject to mini-COBRA rules after a state passes a new law. Employers must track their state laws for compliance issues and changes.

For example, Arizona recently passed a new mini-COBRA law. As of January 1, 2019, Arizona employers with fewer than 20 employees must now comply with ARS § 20-2330.

Such changes may take small businesses by surprise – and that’s a big problem. Complying with state laws is just as important as complying with federal laws, and failure to do so can result in expensive penalties.

Fortunately, it’s easy with Travisoft’s COBRA Administration software. Unlike many COBRA systems, Travisoft keeps you up to date on both federal and state COBRA requirements. Request a demo to learn more.