SPEAKERS The Seltzer Group

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SPEAKERSThe Seltzer Group

• Ann Marie Blashock, PHR, CWCA
• Group Benefits and Human Resources Account
  Manager
• Ann Marie joined The Seltzer Group in the fall of
  2007.
• She is a certified Professional in Human
  Resources and a licensed broker/producer for life
  and health insurance.
• Her most recent position was 10 years as a
  Corporate Human Resources Manager for an
  international plastics manufacturer responsible
  for all HR functions including such areas as
  recruiting, employee relations, benefit design,
  workman's compensation, labor costing/budget, and
  strategic planning.
• Jennifer Davis, M.S., CWCA
• Human Resources Client Advisor
• Jennifer joined The Seltzer Group at the
  beginning of 2007.
• Jenna earned her Masters Degree from Misercordia
  in 2006. She is a licensed broker/producer for
  life and health insurance and is studying for her
  PHR in 2009. She was the Director of Operations
  for the Manufacturers and Employers Association
  for 5 years assisting many local organizations
  with their HR and training needs.

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TODAYS GOAL

• COBRA is a tangled web of qualifying events,
  notices, and timelines regarding the rights of
  employees and covered dependents to continue
  health insurance at a group rate for a limited
  amount of time.
• Our goal is to provide you the most simple
  definitions possible assure you are compliant
  with federal regulations and protect your
  companys interests.

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What is COBRA?
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What is COBRA?

• Congress passed the landmark Consolidated Omnibus
  Budget Reconciliation Act (COBRA) of 1986. 
• COBRA provides certain former employees,
  retirees, spouses, former spouses, and dependent
  children the right to temporary continuation of
  health coverage at group rates.  This coverage,
  however, is only available when coverage is lost
  due to certain specific events.  Group health
  coverage for COBRA participants is usually more
  expensive than health coverage for active
  employees, since usually the employer pays a part
  of the premium for active employees while COBRA
  participants generally pay the entire premium
  themselves.  It is ordinarily less expensive,
  though, than individual health coverage.

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Who is Covered?

• Any employee or covered dependent enrolled
  (except domestic partners if applicable) in your
  health plan.
• Eligible for same coverage as at time of
  qualifying event in cases of death, adoption,
  and birth elections can be adjusted accordingly
  after initial COBRA enrollment

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What Employers Must Comply?

• Private sector employers with health plans who
  have 20 or more employees.
• Total of employees is ALL employees
• 20 employees for 20 or more calendar weeks

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Do I Have to Pay for the coverage?

• NO!
• You may charge 100 of the monthly premium cost
• PLUS 2 for administration costs 102

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Qualifying Events

• Loss of Employment
• Divorces (also stepchild of ex-spouse if they
  were covered)
• Loss of dependent status (age limit)
• Death of an employee
• Reduction in hours (i.e. leave or layoff)
• Group application should state minimum hours
• Need a written policy, usually in handbook, to
  define an active employee for purpose of benefit
  coverage

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Notices to Be Given

• Initial/General Notice
• Election Right Notice
• Change of Plan and/or Rates Notice
• Notice of Early Termination

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Initial/General Notice

• At the time an employee enrolls in your benefit
  plan a basic general notice stating their rights
  under COBRA. Should be sent each enrolled adult.
• Should contain
• Definition of COBRA
• The qualifying events that trigger availability
• Employer (if not the plan admin) must notify the
  plan admin within 30 days after the death,
  terminations, or reduction of hours of a covered
  employee.
• Qualified beneficiaries must notify the plan
  admin within 60 days after a divorce, legal
  separation, or loss of dependent status
• Which benefits are covered by COBRA

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Right to Elect Notice

• The Plan Administrator - Within 14 days of loss
  of coverage or the event that causes loss of
  coverage. We recommend date of loss of coverage.
• Must give 60 days to elect coverage
• Must give 45 days thereafter to pay premiums due
  to date
• Should contain
• Definition of COBRA
• The qualifying events that triggered availability
  and the date coverage ended
• How to elect coverage
• Which benefits are available under COBRA
• The rates to be charged on an individual plan
  listed basis
• The timelines for election, payment, late pays, -
  due date and grace period
• What happens to coverage during election period
• A Credible Coverage Certificate
• What happens if coverage is waived or not elected
• What can cause termination of coverage (other
  coverage, failure to pay, expiration of timeline)
• A statement that this notice does not fully
  describe COBRA or the plan details that further
  detail can be obtained from the plan admin or SPD

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Change of Plan/Rates Notice

• If when you renew your plan you have changes in
  rates and/or coverage the same applies to those
  on COBRA
• Always make sure your census includes those on
  COBRA
• COBRA participants have the right to enroll in
  same health plan options when changing coverage
• You are responsible for notifying them and
  assuring enrollment. You should provide 30 days
  reasonable grace to allow balance payment to be
  made.

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Notice of Ineligibility or Unavailability

• Premiums not paid as required on stated due date
  and after giving a 30 day grace period (also when
  slightly lower payments have been made a notice
  reminder of a 30 day grace period to pay in full
  should be sent)
• Employer ceases to have any group health plan
• A covered person obtains coverage under another
  group plan as long as a pre-existing clause
  does not exist (in PA no longer possible)
• Employee becomes Medicare eligible after electing
  COBRA coverage
• The covered person engages in conduct which would
  lead the carrier to cease coverage (i.e. fraud)

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Is COBRA only 18 months no exceptions?

• Not in all cases Extension are available under
  certain circumstances

• Termination (non-gross misconduct) of employ 18
  months
• Divorce/Legal Separation 36 months
• Death survivor 36 months
• COBRA enrollee Medicare eligibility 36 months
• Lost dependent status 36 months
• SSA determined eligibility
• Second qualifying event

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SSA

• If one of the qualified beneficiaries in a family
  is disabled and meets certain requirements, all
  of the qualified beneficiaries in that family are
  entitled to an 11-month extension of the maximum
  period of continuation coverage (for a total
  maximum period of 29 months of continuation
  coverage). The plan can charge qualified
  beneficiaries an
• increased premium, up to 150 percent of the cost
  of coverage, during the 11-month disability
  extension.
• The requirements are, first, that the disabled
  qualified beneficiary must be determined by the
  Social Security Administration (SSA) to be
  disabled at some point during the first 60 days
  of continuation coverage, and, second, that the
  disability must continue during the rest of the
  initial
• 18-month period of continuation coverage.

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Second Qualifying Event

• An 18-month extension may be available to
  qualified beneficiaries receiving an 18-month
  maximum period of continuation coverage (giving a
  total maximum period of 36 months of continuation
  coverage) if the qualified beneficiaries
  experience a second qualifying event that is
  death of the covered employee, divorce or legal
  separation of the covered employee and spouse,
  Medicare entitlement,
• or loss of dependent child status under the plan.
  The second event can be a second qualifying event
  only if it would have caused the qualified
  beneficiary to lose coverage under the plan in
  the absence of the first
• qualifying event. The plan should have rules for
  how a notice of second qualifying event should be
  provided, and these rules should be described in
  the plans SPD (and in the election notice for
  any offer of an 18-month period of continuation
  coverage).

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Conversion Options after COBRA

• Some group health plans contain a conversion
  option, which allows
• participants and beneficiaries whose coverage
  under the plan
• terminates to convert from group health coverage
  to an individual
• policy. If this conversion option is available
  under the plan to active
• employees and their families, qualified
  beneficiaries whose maximum period of
  continuation coverage ends also must be given the
  option to convert to an individual policy. The
  conversion option must be offered not later than
  180 days before continuation coverage ends. The
  option to convert, however, need not be provided
  if continuation coverage is terminated before the
  end of the maximum period for which it was made
  available.
• This is NOT provided by the employer in any
  manner.

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Questions?
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Would you like a copy of this presentation
emailed? If so please email ablashock_at_seltzergrp
.com
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For More Information.

• If you are interested in one-on- one training
  in COBRA, sample forms, customized forms, or
  outsourcing this duty please contact us at
• 1-888-366-1000
• (Jenna x128, Ann Marie x153).
• Current Seltzer Group health care clients will
  receive most services at no or reduced rates.
• If you are interested in becoming a health
  client of the Seltzer Group please contact us.

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Great Things Comings Soon!

• Seminar
• Thursday, March 20 9AM-12PM
• Cabelas
• CONSUMER DRIVEN HEALTHCARE AND WORK COMP AND
  HEALTHCARE RELATIONSHIP

Seminar Friday, April 11, Registration
830AM Cabelas HEALTHTRAK WELLNESS PROGRAMS
Webinar Thursday, April 10 2-3PM MANAGING PA
WORKERS COMPENSATION CLAIMS
CONTACT JEN TAHANEY AT 1-888-366-1000, EXT. 123
OR EMAIL jtahaney_at_seltzergrp.com