COBRA
The Consolidated Omnibus Budget Reconciliation Act of 1985 ('COBRA') was passed to temper the increasing rate of uninsured Americans. The continuation requirement forces employers to offer insurance continuation to anyone who would otherwise lose coverage due to a qualifying event. Qualifying events include: Termination of employment or reduction of hours, divorce or legal separation, death of covered employee, covered employee becomes eligible for Medicare, dependent ceases to be eligible as a dependent and employer's filing of a bankruptcy proceeding.
ASI administers COBRA benefits for employer groups who prefer to outsource the administrative duties to an administrator that can handle the day-to-day functions required under COBRA.
Under COBRA, employers must provide written notification to all covered employees and their dependents of their rights under COBRA. This notification of rights must be provided (1) upon inception of coverage, (2) in the summary plan description and (3) upon the occurrence of a qualifying event.
COBRA is jointly enforced by the Internal Revenue Service, the U.S. Department of Labor and the Department of Health and Human Services. Penalties for COBRA violations vary but can be significant, ranging from daily penalties and even resulting in Civil lawsuits, in which attorneys' fees and interest can be awarded.
What ASi Does
The plan sponsor or employer has 30 days to notify ASI of a qualifying event. ASI will then provide a COBRA notice and election form to the qualified beneficiary within 14 days of receiving notice from the employer.
All notices are sent by certificate of mailing verified by the postal service. If the employer prefers, notices can be sent by certified mail at an additional charge.
Initial rate notifications are provided in the Notice of Qualifying Events. Renewal rate notification can be provided if your client provides ASI with the renewal rates at least 30 days in advance. ASI will send the letter to the participants immediately following receipt from the employer.
Please contact ASI for a Proposal and a complete list of services and fees.
- Administration of Mandatory Notices Required Under COBRA
- COBRA Tracking
- COBRA Letters Regarding Late Payments and/or Termination of COBRA
- Monthly Billing and Premium Collection
- Annual Notices Regarding Rate Changes/Plan Changes
- COBRA Training and Support
- Provide COBRA Updates to Employers
- ASI Continuously Updates Services to Incorporate COBRA Changes