TaxBandits Knowledge Base

How to report COBRA Coverage on ACA Form 1095-C?

Cobra insurance is an employer-sponsored health insurance coverage that an employee can use after they quit or lose their job. This coverage is through a federal law known as COBRA.
 
Let's look at an example below to better understand how to report COBRA coverage on ACA Form 1095-C.
 
Example: A full-time employee terminated his/her employment in April and COBRA was offered to the employee, spouse & dependents. COBRA coverage began in May and continued throughout the rest of the calendar year. Here’s how you can report COBRA coverage on part-II and III of the 1095-C form.
 
Line 14- Code 1E is used for the months (Jan- Mar) that the employee, spouse & dependents were eligible for MEC coverage providing MV.  Code 1H is used for the months (Apr-Dec) in which the employee was no longer employed, thus there was no offer of coverage.
Line 15- The employees’ monthly share of the lowest-cost, self-only coverage offered only needs to be populated for the months the employee was eligible for coverage.
Line 16- Code 2C is used for the months (Jan-Mar) that the employee was enrolled in coverage. Code 2A is used for the months (Apr-Dec) the employee was not employed.
 
Part III- This section should indicate which months the employee and/or dependents were enrolled in the employer’s health plan and COBRA. 
 
Here, check the “Covered All 12 Months” box to indicate the employee has coverage for all twelve months. Because, initially the employee was enrolled in the employer’s medical plan from January–April, then immediately joined COBRA in May and continued on COBRA for the rest of the year. Therefore, the employee was covered for the entire year. 
 
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