For purposes of determining COBRA eligibility, IRS Notice 2009-27, I.R.B. 2009-16, updated April 20, 2009, defines “involuntary termination” as "a severance from employment due to the independent exercise of the unilateral authority of the employer to terminate the employment, other than due to the employee's implicit or explicit request, where the employee was willing and able to continue performing services. An employee-initiated termination from employment constitutes an involuntary termination if the termination is for good reason due to employer action that causes a material negative change in the employment relationship for the employee".
For example, a reduction in hours is not an involuntary termination, but an employee's voluntary termination in response to an employer-imposed reduction in hours may be one if the reduction in hours is a material negative change in the employment relationship.
The following circumstances constitute an involuntary termination:
COBRA alternative insurance is available regardless of the cause of termination from group insurance and are a likely choice when an involuntary termination does not occur.
COBRA continuation coverage may provide temporary protection when changing jobs, going through a divorce or negotiating other life transitions. Choosing the right health insurance is crucial to protect your health and financial security.