Federal COBRA (Consolidated Omnibus Budget Reconciliation Act) requires employers with 20 or more employees to offer continuation coverage to terminated workers. Florida small businesses under that threshold are exempt from federal COBRA but ARE subject to Florida's 'mini-COBRA' law (FL Statute 627.6692), which applies to employers with fewer than 20 employees. Most Florida small businesses interact with continuation coverage through mini-COBRA, not federal COBRA. This guide explains the threshold count, mini-COBRA mechanics, and admin best practices.
Federal COBRA applies if the employer had 20 or more employees on more than 50% of business days during the prior calendar year. Counting rules:
A Florida business right at 19 employees is exempt; 20 employees triggers federal COBRA for the next year.
FL Statute 627.6692 fills the gap for fully-insured plans of employers with fewer than 20 employees. Key rules:
| Event | Continuation Length |
|---|---|
| Voluntary or involuntary termination (not for gross misconduct) | 18 months |
| Reduction in hours below eligibility threshold | 18 months |
| Divorce / legal separation (for spouse) | 18 months |
| Dependent child aging out of plan | 18 months |
| Death of covered employee (for surviving family) | 18 months |
| Medicare entitlement of employee (for non-Medicare-eligible family) | 18 months |
| Approach | Cost | Best For |
|---|---|---|
| Outsource to TPA (TASC, Wage Works, FlexBank) | $2-$5/EE/mo or $50-$200 per event | Most small businesses; reduces compliance risk |
| Carrier-handled (some FL carriers offer) | Built into premium | If your carrier offers it |
| In-house | Time only | Very small businesses, infrequent terminations |
No — Florida's mini-COBRA statute applies only to fully-insured small group plans. Self-funded small employer plans (rare under 20 EE) are not subject to either federal COBRA or FL mini-COBRA. ERISA preemption complicates state-law application.
Civil liability — terminated employees can sue for damages including coverage that should have been offered, plus attorney's fees. The Florida Department of Insurance also has enforcement authority. Most employers find vendor administration ($2-$5/EE/mo) is far less expensive than the litigation risk.
ICHRA isn't a group health plan in the traditional sense — when employment ends, the underlying individual marketplace coverage continues independently. There's no 'continuation' to elect because the employee already owns their own plan. The employee just loses the ICHRA reimbursement.
A licensed Florida broker can recommend a TPA and handle event-by-event compliance.
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