diff --git a/.github/workflows/code-coverage.yml b/.github/workflows/code-coverage.yml
index f90bd8b617..0e27cbbf4b 100644
--- a/.github/workflows/code-coverage.yml
+++ b/.github/workflows/code-coverage.yml
@@ -242,7 +242,8 @@ jobs:
     - name: Upload coverage reports to Codecov
       uses: codecov/codecov-action@18283e04ce6e62d37312384ff67231eb8fd56d24
       with:
-        fail_ci_if_error: true
+        # Set to false to rely on codecov.yml thresholds instead of failing on upload
+        fail_ci_if_error: false
         files: msquiccoverage.xml
         token: ${{ secrets.CODECOV_TOKEN }}
     - name: Code Coverage Summary Report
diff --git a/codecov.yml b/codecov.yml
index 989ff24adb..eabc806bd8 100644
--- a/codecov.yml
+++ b/codecov.yml
@@ -4,9 +4,16 @@ coverage:
       default:
         target: auto
         threshold: 2%
+        # Allow 2% decrease in project coverage
+        if_not_found: success
+        if_ci_failed: error
     patch:
-      target: 80%
-      threshold: 2%
+      default:
+        target: 80%
+        # Require 80% coverage for new patches
+        if_not_found: success
+        if_ci_failed: error
+
 ignore:
   - "**/*.md"
-  - "docs"
+  - "docs/**/*"