COBRA

Consolidated Omnibus Budget Reconciliation Act (COBRA)

What is COBRA continuation coverage?

The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a federal law which requires that most employers sponsoring group health plans offer employees and their families the opportunity for a temporary extension of health coverage (called "continuation coverage") at group COBRA rates, in certain instances where coverage under the plan would otherwise end because of a "qualifying event." A list of qualifying events is provided in the section, "Who is entitled to elect COBRA".

After a qualifying event occurs and notice of the event (with documentation) is provided to Human Resources, COBRA continuation coverage must be offered to each person losing group health coverage under the Plan. Each person must be a "qualified beneficiary." You, your spouse or your registered domestic partner, and your dependent children could become qualified beneficiaries if they lose group health coverage under the Plan because of the qualifying event.

Qualified beneficiaries who elect COBRA continuation coverage must pay for COBRA continuation coverage.

Who is entitled to elect COBRA?

Employees

If you are an employee, you will become a qualified beneficiary if you lose your group health coverage under the Plan if either one of the following events happens:

Your hours of employment with CSU are reduced, or
Your employment with CSU ends for any reason other than your gross misconduct

Employee's Spouse

If you are the spouse of a CSU employee, you will become a qualified beneficiary if you lose your group health coverage under the Plan due to any of the following qualifying events:

Your spouse (the employee) dies;
Your spouse's hours of employment with CSU are reduced;
Your spouse's employment with CSU ends for any reason other than his or her gross misconduct; or
You become divorced or legally separated from your spouse;
If your spouse (the employee) reduces or eliminates your group health coverage in anticipation of divorce or legal separation, and a divorce or legal separation later occurs, then the divorce may be considered a qualifying event

Employee's Domestic Partner

A person enrolled as the employee’s registered domestic partner will be entitled to elect COBRA if he or she loses group health coverage under the Plan if any of the following qualifying events happen:

Your registered domestic partner (the employee) dies;
Your registered domestic partner's hours of employment with CSU are reduced;
Your registered domestic partner's employment with CSU ends for any reason other than his or her gross misconduct; or
Your registered domestic partnership with the employee is dissolved

Employee's Dependent Child

A person enrolled as the employee’s dependent child will be entitled to elect COBRA if he or she loses group health coverage under the Plan due to any of the following qualifying events:

The parent-employee dies;
The parent-employee's hours of employment with CSU are reduced;
The parent-employee's employment with CSU ends for any reason other than his or her gross misconduct;
The parents become divorced or legally separated; or
The child is no longer eligible for coverage under the plan as a "dependent child"

Bankruptcy

Sometimes, filing a proceeding in bankruptcy under title 11 of the United States Code can be a qualifying event. If a proceeding in bankruptcy is filed with respect to CSU, and that bankruptcy results in the loss of coverage of any retired employee covered under the Plan, the retired employee will become a qualified beneficiary with respect to the bankruptcy. The retired employee’s spouse, surviving spouse, and dependent children will also become qualified beneficiaries if bankruptcy results in the loss of their coverage under the Plan.

When is COBRA coverage available?

The Plan will offer COBRA continuation coverage to qualified beneficiaries only after the Office of Human Resources has been notified that a qualifying event has occurred.

Notifying Human Resources

When the qualifying event is one of the following, you do not need to notify the Office of Human Resources of the qualifying event:

the end of employment or reduction in hours of employment,
death of the employee, or
commencement of a proceeding in bankruptcy with respect to CSU,

When the qualifying event is one of the following, a COBRA election will be available to you:

divorce or legal separation of the employee and spouse,
dissolution of registered domestic partnership, or
a dependent child losing eligibility for coverage as a dependent child

You must notify HR in writing within 60 days after the later of (a) the date the qualifying event occurs, or (b) the date on which you lose (or would lose) group health coverage under the terms of the Plan as a result of the qualifying event.

Supporting Documentation

The employee must provide the Office of Human Resources with documentation supporting the occurrence of the qualifying event. Acceptable documentation includes the documents listed below and any other supporting documentation approved by the Office of Human Resources:

divorce or legal separation – a copy of the decree of divorce or separation agreement;
dissolution of registered domestic partnership – a copy of the dissolution documents; and
child no longer qualifying as a dependent child –a copy of the child’s marriage certificate (in case of the child’s marriage)

If these procedures are not followed within the 60-day period as directed above, you will lose your right to elect COBRA.

Electing COBRA

Each qualified beneficiary will have an independent right to elect COBRA. Covered employees and spouses may elect COBRA on behalf of their children who are qualified beneficiaries. Any qualified beneficiary for whom COBRA is not elected within the 60-day election period specified in the Plan’s COBRA Qualifying Event (Election) Notice will lose his or her right to elect COBRA.

Qualified beneficiaries who are entitled to elect COBRA may do so even if they have other group health plan coverage or are entitled to Medicare benefits on or before the date on which COBRA is elected. However, a qualified beneficiary’s COBRA coverage will terminate automatically if, after electing COBRA, he or she becomes entitled to Medicare benefits or becomes covered under another group health plan (but only after any applicable preexisting condition exclusions of that other plan have been exhausted or satisfied.)

How long does COBRA coverage last?

COBRA coverage is a temporary continuation of coverage. The length of coverage is dependant on the type of qualifying event.

Coverage of up to 36 months

For the qualifying events listed below, COBRA coverage can last for up to 36 months:

Death of the employee
Covered employee’s divorce or legal separation
Covered employee’s dissolution of domestic partnership, or
A dependent child losing eligibility as a dependent child
End of employment or reduction of the employee's hours of employment, if the employee became entitled to Medicare benefits less than 18 months before the qualifying event (lasts until 36 months after the date of Medicare entitlement)
- For example, if a covered employee becomes entitled to Medicare 8 months before the date on which his employment terminates, COBRA coverage for his spouse and children who lost coverage as a result of his termination can last up to 36 months after the date of Medicare entitlement, which is equal to 28 months after the date of the qualifying event (36 months minus 8 months). This COBRA coverage period is available only if the covered employee becomes entitled to Medicare within 18 months BEFORE the termination or reduction of hours.

Coverage of up to 18 months

End of employment or reduction of the employee's hours of employment
Note: COBRA coverage under the HCRA can last only until the end of the year in which the qualifying event occurred – see “HCRA Coverage” section below.

Extension of Coverage

There are two ways in which the period of COBRA coverage resulting from a termination of employment or reduction of hours can be extended. (The period of COBRA coverage for the HCRA cannot be extended under any circumstances.)

Disability of 18-month period of COBRA coverage

If a qualified beneficiary is determined by the Social Security Administration to be disabled and you notify the Office of Human Resources and the applicable dental/vision carriers/COBRA administrators in a timely fashion, all of the qualified beneficiaries in your family may be entitled to receive up to an additional 11 months of COBRA coverage, for a total maximum of 29 months. This extension is available only for qualified beneficiaries who are receiving COBRA coverage because of a qualifying event that was the covered employee’s termination or reduction of hours. The disability must have started at some time before the 61st day after the covered employee’s termination of employment or reduction of hours and must last until at least the end of the time period of COBRA coverage that would be available without the disability extension (generally 18 months, as described above).

The disability extension is available only if you notify the Office of Human Resources and the applicable dental/vision carriers/COBRA administrators as instructed in the Qualifying Event (Election) Notice in writing of the Social Security Administration’s determination of disability within 60 days after the latest of:

the date of the Social Security Administration’s disability determination;
the date of the covered employee’s termination of employment or reduction of hours; and
the date on which the qualified beneficiary loses (or would lose) coverage under the terms of the Plan as a result of the covered employee’s termination of employment or reduction of hours.
You must also provide this notice within 18 months after the covered employee’s termination of employment or reduction of hours in order to be entitled to a disability extension. The notice must include a copy of the Social Security Administration disability notification letter and must include the information about the covered employee or qualified beneficiary requesting extension of COBRA coverage due to disability.

If these procedures are not followed or if the notice is not provided in writing to the Office of Human Resources as instructed above during the 60-day notice period and within 18 months after the covered employee’s termination of employment or reduction of hours, there will be no extension of COBRA coverage due to disability.

Second qualifying event extension of 18-month period of COBRA coverage

If a qualified beneficiary experiences another qualifying event while receiving COBRA coverage because of the covered employee’s termination of employment or reduction of hours (including COBRA coverage during a disability extension period as described above), the spouse and dependent children receiving COBRA coverage can get up to 18 additional months of COBRA coverage, for a maximum of 36 months, if notice of the second qualifying event is properly given to the Office of Human Resources. This extension may be available to the spouse, registered domestic partner and any dependent children receiving COBRA coverage if the employee or former employee dies or gets divorced or legally separated, dissolves a domestic partnership, or if the dependent child becomes ineligible under the Plan as a dependent child.

This extension is only available if you follow the notification procedures contained in the Qualifying Event (Election) Notice.

Health Care Reimbursement Account (HCRA) Coverage

COBRA coverage under the Health Care Reimbursement Account (HCRA) will be offered only to qualified beneficiaries losing coverage who have underspent accounts. A qualified beneficiary has an underspent account if the annual limit elected by the covered employee, reduced by reimbursements up to the time of qualifying event, is equal to or more than the amount of the premiums for the HCRA COBRA coverage that will be charged for the remainder of the plan year.

COBRA coverage will consist of the HCRA coverage in force at the time of the qualifying event (i.e., the elected annual limit reduced by expenses reimbursed up to the time of the qualifying event). The use-it-or-lose-it rule will continue to apply, so any unused amounts will be forfeited at the end of the plan year, and COBRA coverage will terminate at the end of the plan year.

California Continuation Rights for Certain Qualified Beneficiaries

If you are enrolled in insured medical or HMO coverage in California, please contact your insurance company or HMO for information about rights, after the expiration of Federal COBRA coverage, to continue coverage in certain situations.

Conversion Privilege After COBRA Terminates

You and your enrolled dependents may be entitled to a conversion policy upon the expiration of COBRA coverage. In the event you do not elect COBRA coverage, you may still apply for conversion to an individual medical policy. If you wish to convert your medical coverage to an individual conversion policy, you must make your application within 30 days from the date your coverage terminates to ensure continuous coverage. If you elect COBRA coverage, you will have the option to convert your medical coverage to an individual policy during the last 180 days of the maximum, 18, 29, or 36 month COBRA coverage period.

Change of Address

In order to protect your family's rights, you should keep the Office of Human Resources informed of any changes in the addresses of family members. You should also keep a copy, for your records, of any notices you send to the Office of Human Resources.

COBRA Provisions for Government Employees

Information about COBRA provisions for governmental employees is available from:

Centers for Medicare & Medicaid Services (CMS)

Private Health Insurance Group
7500 Security Boulevard
Mail Stop S3-16-16
Baltimore, Maryland 21244-1850

Phone: 410-786-1565 - This is not a toll-free number
Website: