This chapter contains these topics:
To comply with the regulations of the Consolidated Omnibus Budget Reconciliation Act (COBRA)
To enroll qualified beneficiaries in COBRA
To maintain COBRA election information
To track profile data on qualified beneficiaries
COBRA requires that most employers who sponsor group health plans offer employees and their dependents continuation of coverage at group rates that the employee would otherwise have forfeited due to a qualifying event. Federal and state agencies regulate COBRA coverage.
To comply with the requirements for COBRA coverage, complete the following tasks:
Process COBRA notification
Work with COBRA coverage
Work with COBRA profile data
This guide is not a replacement for the federal and state requirements. You should be familiar with the regulations and mandates provided through COBRA to implement and maintain your COBRA coverage benefits.
Qualifying events are events that result in an employee losing group health coverage. Examples of qualifying events for an employee are:
Voluntary or involuntary termination of employment for any reason other than gross misconduct
Reduction in employment hours, such as changing from full-time to part-time status or taking a leave of absence
Eligibility to enroll in Medicare
Examples of qualifying events for a spouse include:
Death of spouse
Divorce or legal separation from a spouse
Eligibility of a spouse to enroll in Medicare
Examples of qualifying events for a dependent child include:
Death of parent
Dependent child ceases to be a dependent child under the employer's plan rules, for example, a child reaches age 18 and does not attend college or reaches age 21 and attends college
A qualified beneficiary is any individual covered under the employer's group health plan on the day before a qualifying event occurs. Each qualified beneficiary who elects COBRA coverage receives the same core benefits that they were entitled to as an active employee. Qualified beneficiaries include:
Employee
Employee's spouse
Employee's dependent children
Employees and their dependents impacted by a qualifying event are entitled to COBRA coverage. You must notify employees that they are qualified beneficiaries and are eligible for COBRA coverage. Qualified beneficiaries are responsible for paying the premium for the plan and any administrative, or handling, fees that you incur. You administer claims and benefits for COBRA participants in the same way you do for employees enrolled in the same plans, including flexible spending accounts.
You can track the dates a qualified beneficiary is eligible for COBRA, elections, and payment dates. Initial notice letters can be sent and the date recorded. As with all Human Resources system programs, you can set up and maintain additional information, or profile data, for all qualified beneficiaries . For example, you can record medical history or plan remittance information.
After you enroll qualified beneficiaries, you can print reports to review information on the COBRA coverage. You can also print reports with the additional information obtained through the profile data that you choose to track.
The following terms are used throughout COBRA coverage: