Colorado closes the small-employer gap in federal COBRA: state continuation gives groups under 20 employees up to 18 months.
Federal COBRA stops at 20 employees. Colorado law picks up where it ends for fully insured plans, so a small employer still has continuation duties, usually carried out through the carrier.
How federal COBRA and Colorado continuation fit together.
Federal COBRA Applies at 20 Employees
If the employer had 20 or more employees on a typical business day last year, federal COBRA governs. Former employees can generally continue for up to 18 months after a job loss or reduction in hours, and up to 36 months after other qualifying events.
Colorado Covers Employers Under 20
Colorado continuation under C.R.S. 10-16-108 reaches employees of employers with fewer than 20 employees, the group federal COBRA leaves out. The maximum period in the guidance we reviewed is 18 months.
Prior Coverage Matters
The summaries we reviewed describe a requirement that the employee was continuously covered for about six months before the qualifying event. A new hire who leaves in month three may not qualify, so check the carrier rule before telling someone no.
Qualifying Events Are Broader Than a Layoff
Published summaries list termination, death of the employee, a change in marital or civil union status, and a reduction in hours. Divorce and death matter because the family, not the employee, is the one who needs the notice.
Fully Insured Plans Are the Core Case
Colorado continuation is an insurance-law rule enforced by the Division of Insurance, so it attaches to insured group policies. Self-funded ERISA plans follow federal COBRA only, which means funding type decides the answer.
The Carrier Usually Administers It
For small groups the carrier often runs the state continuation process. That does not remove the employer duty to tell a departing employee the right is coming, so the separation checklist should name it.
What continuation costs in Colorado, and what to expect.
Federal COBRA: Up to 102 Percent
Federal COBRA premium can be up to 102 percent of the total plan cost, which is the employer share, the employee share and a 2 percent administrative fee. On a $700 monthly premium, that is $714 a month for one person.
Disability Extension: Up to 150 Percent
If the Social Security Administration finds a COBRA participant disabled, months 19 through 29 can be billed at up to 150 percent. The disability extension is a federal COBRA rule, so ask the carrier whether state continuation offers anything similar.
Colorado Continuation: Ask for the Number
The sources we reviewed describe the state premium as comparable to COBRA limits and do not publish a single state percentage. Get the exact monthly figure from the carrier in writing before the employee elects.
Why It Feels Expensive
While employed, the person paid only a share. On continuation they pay the whole bill, so a plan that cost $150 a paycheck can show up as $700 or more a month. Explaining that early prevents most complaints.
What to settle before the first separation happens.
How many employees do we count?
The line between federal COBRA and Colorado continuation is 20 employees, and part-time staff count in fractions under COBRA. Put the headcount calculation on file so the right law is chosen the same way each time.
Who tells the departing employee?
Even when the carrier runs continuation, someone at the company has to start it. Name the person, the deadline and the form so a termination does not leave a family without coverage by accident.
What is the exact price and end date?
Ask the carrier for a one-page statement with the monthly price, the first payment due date and the date coverage ends. The employee compares that against a Marketplace plan during the same 60-day window.
Do we have employees in more than one state?
A policy issued in Colorado follows Colorado rules, while a policy issued elsewhere may not. Ask the carrier where the policy was issued and have it confirm in writing.
The questions Colorado employers ask about COBRA.
How much is COBRA in Colorado?
Federal COBRA premium can be up to 102 percent of the full plan cost, so a $700 monthly plan costs $714 for one person. Colorado state continuation is described as comparable to COBRA limits, but ask the carrier for the exact number.
How long does continuation last in Colorado?
Federal COBRA lasts up to 18 months for a termination or reduction in hours and up to 36 months for other qualifying events. Colorado state continuation for employers under 20 employees is described as lasting up to 18 months.
Does Colorado have its own mini-COBRA?
Yes. C.R.S. 10-16-108 provides state continuation for employees of smaller employers, and the Colorado Division of Insurance enforces it.
We have 12 employees. Do we owe anything?
Federal COBRA does not apply, but Colorado continuation can if the plan is fully insured. Ask the carrier for its continuation procedure and notice form before the first departure.
Does Colorado continuation apply to self-funded plans?
Generally no. State insurance law reaches insured policies, and self-funded ERISA plans follow federal COBRA. Confirm how the plan is funded.
Who has to send the COBRA notice?
Under federal COBRA the employer notifies the plan administrator within 30 days of a qualifying event, and the administrator sends the election notice within 14 days. Colorado continuation notices usually come through the carrier.
How long does the employee have to elect?
Under federal COBRA, at least 60 days from the notice date or the date coverage would end, whichever is later, and the first premium is generally due within 45 days after electing. Confirm state continuation deadlines with the carrier.
Can the employee use the Marketplace instead?
Losing job-based coverage opens a 60-day special enrollment period on the Marketplace. We recommend showing the employee both prices side by side before the election window closes.
General information about continuation coverage, not legal advice. Plan-specific questions belong with ERISA counsel and your carrier, and we will bring them in.
Where these details come from.
This page summarizes public guidance reviewed in October 2026. State rules change, so confirm current requirements with the Colorado Division of Insurance and your carrier.
Colorado Division of Insurance →
U.S. Department of Labor: COBRA Continuation Coverage →
KFF: Expanded COBRA Continuation Coverage for Small Firm Employees →
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