How Do You Comply with COBRA Coverage?

Employees and their dependents who are affected 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 are incurred. You administer claims and benefits for COBRA participants in the same way that you administer them for the employees who are enrolled in the same plans, including flexible spending accounts.

You can track the date on which a qualified beneficiary is eligible for COBRA, election dates, and payment dates. You can send initial notice letters and record the dates on which you sent them. You can also set up and maintain additional information, or supplemental 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 about COBRA coverage. You can also print reports that include the additional information that you entered as supplemental data.

This table describes COBRA-related terms that are used throughout the software:

Term	Description
Benefit group	Any group that includes employees who are eligible for the same benefit plans. Many companies establish a COBRA benefit group specifically for qualified beneficiaries who have elected to enroll in COBRA coverage.
Benefit plan	Any plan available with COBRA that is offered by the employer. These plans include, but are not limited to: Medical insurance Dental insurance Flexible spending accounts
Dependent	Any person, usually related to the employee, who is eligible for coverage in a benefit plan. A dependent is also a qualified beneficiary.
Qualified beneficiary	Any person who is entitled to receive benefits from a COBRA plan. A qualified beneficiary who elects the COBRA coverage is often called a COBRA participant. This term can be used interchangeably with qualified beneficiary.
Qualifying event	Any occurrence that causes an employee or qualified beneficiary to lose group insurance coverage and which, under COBRA regulations, qualifies the qualified beneficiary for continuation of coverage. For example, an employee who is terminated for gross misconduct loses group insurance coverage, but, under COBRA regulations, is not entitled to continued coverage. Therefore, termination for gross misconduct is not a qualifying event.