COBRA Deadlines Extended and COBRA Alternatives Are Saving Families $500+ per Month!
We encourage our readers to look at the following informative artice from our friends at the "Daily Insurance Report"
Benefit Plan Deadlines Extended – COBRA, Special Enrollment, Plan Disclosures And More
Source: Kelly Haab-Tallitsch, SmithAmundsen LLC / JDSUPRA
On April 29, 2020, the Department of Labor (DOL) and the Treasury Department issued guidance extending certain timeframes related to employee benefit plans due to the COVID-19 outbreak. The agencies acknowledge that plan sponsors, participants and beneficiaries may have difficulty meeting the standard timeframes due to the national emergency and the extensions are intended to help maintain group health plan coverage.
Relief for Participants and Beneficiaries
A joint final rule issued by the DOL and Treasury provides that all group health plans, disability plans, other employee welfare benefit plans subject to the Employee Retirement Income Security Act (ERISA) must disregard the period from March 1, 2020 until 60 days after the COVID-19 National Emergency ends (or such other date as the agencies announce), referred to as the “Outbreak Period,” in determining certain notice and payment deadlines.
This includes:
The 60-day COBRA election period; Due dates for making COBRA premium payments; The 30-day (or 60-day as applicable) HIPAA special enrollment period; The 60-day period for participants to notify a plan of a COBRA qualifying event (e.g. divorce); and The deadlines for filing a claim for benefits, an appeal, or a request for an external review of a denied claim.
The final rule provides examples of how these extensions work in practice, based on the assumption that the National Emergency ended on April 30, with the Outbreak Period ending on June 29 (60 days after the end of the National Emergency).
Electing COBRA – Individual A experiences a qualifying event for COBRA purposes as a result of a reduction of hours below the hours necessary to meet the group health plan’s eligibility requirements. Individual A is provided a COBRA election notice on April 1, 2020.
The Outbreak Period is disregarded for purposes of determining Individual A’s COBRA election period. The last day of Individual A’s COBRA election period is 60 days after June 29, 2020, which would be August 28, 2020.
Special Enrollment – On March 31, 2020, Individual B gave birth and would like to enroll herself and the child into her employer’s plan; however, open enrollment does not begin until November 15.
The Outbreak Period is disregarded for purposes of determining Individual B’s special enrollment period. Individual B may exercise her special enrollment rights for herself and her child into her employer’s plan until 30 days after June 29, 2020, which is July 29, 2020.
COBRA Premium Payments – On March 1, 2020, Individual C was receiving COBRA continuation coverage under a group health plan. Monthly premium payments are due by the first of the month.
Individual C made a timely February payment, but did not make the March payment or any subsequent payments during the Outbreak Period. As of July 1, Individual C has made no premium payments for March, April, May, or June.
Does Individual C lose COBRA coverage, and if so for which month(s)?
Under the terms of the COBRA statute, premium payments are timely if made within 30 days from the date they are first due.
In calculating the 30-day period, however, the Outbreak Period is disregarded, and payments for March, April, May, and June are all deemed to be timely if they are made within 30 days after the end of the Outbreak Period.
Accordingly, premium payments for four months (i.e., March, April, May, and June) are all due by July 29, 2020. Individual C is entitled to COBRA continuation coverage for these months if she timely makes payment. Individual C is eligible to receive coverage under the terms of the plan during this interim period even though some or all of Individual C’s premium payments may not be received until July 29, 2020. --end of article
While the above goes into much depth about Employer-sponsored plans and COBRA eligibility, it does not apply to many in my readership who are transitioning AWAY from COBRA due to the exhorbitant premiums required to continue those plans?
It is worth noting that there are MANY non-ACA options available for insured who are wanting to substantially save on premiums while maintainig health insurance coverage that's both useful and affordable.
Firstly, "what are non-ACA plans?". ACA stands for "Affordable Care Act". You might also hear this described as "Marketplace coverage". Thirdly, it is many times referred to as "ObamaCare".
This is health insurance whose eligibility and administration is overseen by the US goverment. It is designed so that ANYONE with any level of health can qualify for coverage. It is also mandated that these plans must include several types of benefits such as preventative and wellness services, pediatric dental, pregnancy/maternaty/newborn care, etc.
While many of the 10 "essential benefits" that are mandatory on an ACA plan are important, some are less useful or even of no importance to our clientele (who are typically past child-bearing years).
Because ALL of those essential benefits don't have to be covered when you choose a plan on your own, and because the health insurance company may exclude pre-existing conditions, it costs FAR less for the health insurance company to insure you.
Most of our clients save $500 per month OR MORE by choosing their own independent coverage. They also will typically have much lower deductibles and a lot of "first-dollar" benefits.
These plans can be designed to cover the services and benefits YOU want, rather than what is mandated by the Marketplace rules.
If you are considering whether or not to accept your workplace's COBRA benefits or go on your own, you owe it to yourself to schedule a call with our office. We can help you look at all of your options so that when you do make a choice, it will be driven by facts, finances, and what is most important to YOU.