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Date: May 1, 2006 (revised)
COBRA CONTINUATION COVERAGE
I. PURPOSE:
To advise employees and their families of the opportunity to pay for a temporary extension of health coverage at the State’s group rate.
II. APPLICABLE TO:
All benefit eligible employees
III. RESPONSIBILITY:
1. The Director, Personnel Services to administer the program including the State Benefits office.
2. The employees and their families (1) to notify the University of the appropriate “qualifying event”, in order to initiate continuation coverage, and (2) to submit timely monthly payments.
IV. POLICY:
A federal law – Consolidated Omnibus Budget Reconciliation Act (COBRA) – requires the State of Rhode Island to offer employees and their families the opportunity to pay for a temporary extension of health coverage called “continuation coverage”. The employee and the family members listed under his/her membership may make monthly payments at 102% of the State’s group rate for a period of 18 months to 36 months depending upon the “qualifying event”.
Each of the new hires receives a copy of the Group Health Continuation Under COBRA memo. Notification to the employee is considered notification to the dependents. An effort will be made to notify ex-spouses covered under the employees health plan. It advises them of their rights and obligations.
V. PROCEDURE:
When a qualifying event occurs (see list below for “qualifying events”), a letter and COBRA notice is sent to the qualified beneficiary informing him/her of the option to purchase health care coverage at the current active rate for State employees along with a 2% administration fee. The employee/family member has 60 days in which to decide if they want to purchase coverage. If COBRA is selected, the forms are returned to the COBRA administrator. The Federal law allows 45 days in which to make the first payment; however, enrollment with the health carrier(s) will not take place until the first payment is made. Subsequent payments must be made by the first of each month. If monthly payments are not received by the first of each month, coverage is subject to termination.
A“qualifying event” can be:
1. Termination of employment
2. Reduction in hours of employment
3. Spouse or dependent of a covered employee due to:
a. a covered employee’s death
b. a termination of your spouse’s employment (for reasons other than gross misconduct) or reduction in your spouse’s hours of employment with the State of Rhode Island
c. a spouse’s divorce or legal separation from a covered employee benefit
d. a covered employee’s entitlement to Medicare
e. a dependent child’s loss of dependent status
