Cobra Notice Nightmare
Paul in Cannon Beach
4,703 Posts
Recently I attended a COBRA compliance seminar and came away with the impression that we have not been administering COBRA correctly. In the past we have simply given or mailed the COBRA election notice whenever a covered employee has left.
I am now aware that there are as many as 8 possible notices including: the initial notice (when an employee is hired), the event notice (termination, etc.) the open enrollment notice, the insignificant payment notice, the plan change notice, etc....
Also, I am aware that the form we have been using does not reflect changes in the law passed in 1999.
We are considering outsourcing our COBRA administration at this point. We are a small company (40 covered employees) but the risks of not administering COBRA correctly are significant. Anyone have any suggestions? Where do you get your notices? Are you sending out the correct notices? Thanks for your help!
I am now aware that there are as many as 8 possible notices including: the initial notice (when an employee is hired), the event notice (termination, etc.) the open enrollment notice, the insignificant payment notice, the plan change notice, etc....
Also, I am aware that the form we have been using does not reflect changes in the law passed in 1999.
We are considering outsourcing our COBRA administration at this point. We are a small company (40 covered employees) but the risks of not administering COBRA correctly are significant. Anyone have any suggestions? Where do you get your notices? Are you sending out the correct notices? Thanks for your help!
Comments
employers do outsource this. COBRAServe is one large vendor providing this
service, but you would have to check on their rates. Also, health insurance
companies often offer this service as a part of their health plan
administration. If your current carrier doesn't offer this service, they might
know who in your area does. However, the employer cannot outsource all their
responsibilities with respect to COBRA. Your ERISA counsel should be able to
help you update your forms and help you implement procedures for sending out the
various COBRA notices.
they had samples to go by (i.e. general notice and the election notice).
In regards to insufficient premium paid your seminar should have
referenced there is a "short payment rule" if is $10 or less or 10% premium
that the employer accept payment in full or notify QB of deficiency and allow
30 days from the date of the notification to correct.
We too are a small company (16 FT employees and have 4 former employees on COBRA).
If you want copies of these two letters to review, let me know. Along with the
monthly statement, I attach a COBRA blurb telling when payment is due. It is a
simple reminder and won't require separate mailing.
Cindy Dupree
Benefits Administrator / Office Mgr.
Chattanooga Area CVB
[email]cindyd@chattanoogacvb.com[/email]