The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) requires employer-sponsored group health plans to offer continuing health care coverage at group rates for employees and their dependents who would otherwise lose health benefits upon the occurrence of certain events. Such events include:
- death of a covered employee
- termination of a covered employee’s employment
- reduction in hours of employment of a covered employee
- divorce of a covered employee
- a covered employee becomes entitled to Medicare
- a covered dependent ceasing to be a dependent child under the terms of the plan
- an employer’s commencement of bankruptcy proceeding
(detailed definitions of qualifying events are contained in the law itself – click here for more information).
AACPS is required by COBRA to extend employees the option to continue lost coverage for 18 months to terminating employees or those with reduction in hours. All other qualifying events, except bankruptcy, have a COBRA continuation period of 36 months. Coverage is retroactive to the first of the month following the month active AACPS coverage terminates. For example, if a dependent is no longer a full-time student in May, active coverage ends 5/31 and the COBRA effective date is 6/1.
AACPS’ COBRA administrator is Discovery Benefits. Discovery Benefits will send COBRA notifications to COBRA eligible participants based on the above criteria. COBRA eligible participants must notify Discovery Benefits of intention to continue coverage within 60 days calculated from the date of letter or date of qualifying event whichever is later. Discovery Benefits will enroll the applicant in COBRA once the election form and initial payment are received.
Note that COBRA eligible participants electing COBRA, including dependents, must select the same healthcare plan as currently enrolled.
Generally, continuation of coverage will remain in force until the earlier of:
- the date payments are not submitted on a timely basis
- the date the COBRA beneficiary notifies HR/benefits of intention to terminate
- the date the COBRA beneficiary becomes eligible for coverage that is not subject to pre-existing limitations.
If dropping a dependent means a change in plan level (i.g. family changes to husband/wife) this change will automatically be processed by HR/Benefits. Other less costly options for individual coverage can be found on the Maryland Health Exchange or by contacting CareFirst (local phone number 410-268-6488).
It is the employee’s legal obligation to notify AACPS of any lifestyle change affecting a change in dependent status. AACPS and its healthcare carriers will conduct periodic audits of dependent enrollments for all employees with dependent coverage. It is fraudulent to include your dependents on the AACPS health plan when they do not meet eligibility requirements. Claims paid for ineligible dependents will be recouped by the healthcare vendor from the provider, which could possibly cause you to be financially liable.
For additional information about specifics of COBRA coverage, COBRA rights and COBRA costs, please contact Discovery Benefits at 866-451-3399 or e-mail firstname.lastname@example.org. You will be provided with a comprehensive overview of your benefits, detail contact information, and links to various carrier websites.