The most commonly offered health care benefits are offered under the Consolidated Omnibus Budget Reconciliation Act (COBRA). COBRA is not offered by every employer or in every circumstance of an employee separating from the employer. If the employee elects to take COBRA coverage, the employee must pay the usually expensive premium. The length of COBRA coverage also depends on the circumstances of the separation. For more information on COBRA go to the website www.dol.gov/ebsa/faqs/faq_consumer_cobra.html.
When you receive health benefits through COBRA, you are usually expected to pay the premium, instead of your employer covering all or part of it as was done when you were still employed at the company. However, a severance agreement can be drawn up to include almost anything an employee and employer can agree on, including having the employee remain on payroll until the severance is paid out, which allows the employee to continue health benefits at the current premium cost.
Sometimes the employee’s attorney may be able to negotiate a better settlement deal than was first offered. However, you must be careful about looking greedy. Remember, the employer has no obligation to provide the employee with either a severance or a settlement agreement. There is a point in every negotiation when the employer thinks that it is giving up too much and may withdraw any previous offer.