COBRA Administration Procedures
COBRA ADMINISTRATION PROCEDURES
through FLEX Corp
As Cape Cod Municipal Health Group’s COBRA Plan Administrator, Flex Corp will handle
every detail of COBRA, other than providing the Initial Notice. Flex will handle everything from sending election notices to qualifying beneficiaries to receiving monthly COBRA payments.
The responsibilities of each governmental unit within CCMHG are few but extremely important!
I. WHEN AN EMPLOYEE ELECTS HEALTH CARE COVERAGE
***When you have an employee enroll in health or dental coverage for the first time, it is very important that you give or send the employee a COBRA Initial Notice. If an employee changes their eligibility level from individual to family, you would need to provide this notice to the spouse and/or covered dependents. This notice informs the employee and spouse of their rights under COBRA. We strongly suggest that you have the employee sign that they have received the COBRA Initial Notice.
II. COBRA QUALIFYING EVENTS
A COBRA Qualified Beneficiary is any individual covered by a group health plan on the day
before a qualifying event. A qualified beneficiary may be an employee, the employee’s spouse and dependent children, and in certain cases, a retired employee, the retired employee’s spouse and dependent children.
COBRA qualifying events for employees are:
-Voluntary or involuntary termination of employment for reasons other than “gross misconduct”
-Reduction in hours of employment making employee ineligible for group coverage
COBRA qualifying events for spouses are:
-Termination of the covered employee’s employment for any reason other than “gross
misconduct”
-Reduction in hours worked by the covered employee
-Covered employee’s becoming entitled to Medicare (doesn’t apply to most governmental
employers)
-Divorce or legal separation of the covered employee
-Death of the covered employee
COBRA qualifying events for dependent children are:
-Termination of the covered employee’s employment for any reason other than “gross
misconduct”
-Reduction in hours worked by the covered employee
-Loss of “dependent child” status under the plan rules
-Covered employee’s becoming entitled to Medicare (doesn’t apply to most governmental
employers)
-Divorce or legal separation of the covered employee
-Death of the covered employee
NOTE: The employee or spouse must notify the employer (who then notifies GBS) or the Plan Administrator directly within 60 days of events consisting of divorce or legal separation or a child’s ceasing to be covered as a dependent under plan rules.
NOTE: The IRS has ruled that leave taken under the Family and Medical Leave Act (FMLA) is not a COBRA Qualifying Event. An employee must be allowed to elect COBRA continuation coverage after the 12 weeks of FMLA leave expires – even if he/she failed to pay health premiums or declined coverage during the leave. Furthermore, the IRS says that the right to COBRA continuation coverage is not conditioned upon the employee’s reimbursement of any premiums the employer paid to maintain the health coverage during the FMLA period!