COBRA: Health Insurance Continuation Coverage After Eligibility Loss

Handbook of Operating Procedures 5-3210

COBRA: Health Insurance Continuation Coverage After Eligibility Loss

The University of Texas at Austin
Executive Sponsor: Senior Vice President and Chief Financial Officer
November 1, 2001

 


 

  1. Policy Statement

The University of Texas at Austin authorizes eligible employees and their dependent(s) to continue existing medical, dental and/or vision insurance after the employee or dependent(s) is no longer eligible for insurance coverage in accordance with the Consolidated Omnibus Budget Reconciliation Act (COBRA).

 

  1. Scope

This policy applies to eligible employees and their dependent(s) who are currently receiving medical, dental and/or vision benefits through a University provided health care plan.

 

  1. Definitions
  1. An eligible employee, for purposes of COBRA eligibility, is a benefits-eligible employee appointed to work at least twenty (20) hours per week for at least four and one-half (4 ½) continuous months.
  1. An eligible dependent, for purposes of COBRA eligibility, includes a dependent who was covered by the eligible employee's medical, dental, or vision insurance at the time of the qualifying event.
  1. Qualifying Events and Continuation Periods

Covered employees and their dependent(s) have the right to elect continuation of coverage under a University health benefits plan after the occurrence of certain qualifying events. The type of qualifying event will determine the person's eligibility for continued health benefits and the amount of time the continued health benefits are available.

 

  1. Employees. The following events qualify an eligible employee for continued coverage for up to eighteen (18) months:
  1. Separation from employment for reasons other than gross misconduct

or

 

  1. Reduction of work hours to a benefits-ineligible status.

Eligible employees who are disabled (as provided by Title II or XVI of the Social Security Act) within sixty (60) days of either of the above qualifying events may continue coverage for an additional eleven (11) months if they are continuously disabled.

 

  1. Employee's Spouse and Dependent(s). The following events qualify an eligible employee's spouse and dependent(s) for continued coverage for up to thirty-six (36) months:
  1. Death of employee,
  1. Divorce or legal separation or
  1. Loss of a child's dependent status by the child reaching age 25 or marrying.
  1. Notification Requirements
  1. Employee Responsibilities. In the event of a divorce, legal separation, or loss of a child's dependent status, the employee or dependent(s) must notify Human Resources within sixty (60) days. Failure to provide timely notice of the occurrence of a qualifying event will result in the loss of the right to elect to continue medical coverage under COBRA.
  1. Supervisor and Department Responsibilities. In the event of an employee's death, separation from employment or reduction of hours to a benefits-ineligible position, the department shall immediately process the appropriate electronic appointment document advising Human Resources of the change in status.
  1. University Responsibilities. Upon receiving notice of the qualifying event causing the employee and dependent(s) to be ineligible for coverage, the University shall provide notice within fourteen (14) days to the covered employee and any covered dependent(s) of their rights to elect continued health insurance coverage under COBRA.
  1. Enrollment Deadlines and Coverage Duration

The following deadlines and coverage duration apply to COBRA:

 

  1. Coverage. A person who wishes to elect continued health insurance coverage under COBRA must obtain an application from the Human Resources and submit it directly to the applicable plan within sixty (60) days of the qualifying event.
  1. Premium Payment. A person who elects coverage under COBRA is responsible for paying the full premium amount plus an additional two (2) percent of that amount directly to the appropriate insurance plan. The first payment must be made within forty-five (45) days after the date the application is mailed and will not be active until received by the insurance company.
  1. Coverage Duration. COBRA coverage begins on the date that coverage would have otherwise been lost because of a qualifying event. COBRA coverage will end:
  1. On the last day maximum coverage is reached,
  1. If premiums are not paid on a timely basis,
  1. When coverage is obtained with another employer group health plan or
  1. When the covered person becomes entitled to Medicare.
  1. Delegation of Authority

Authority is hereby delegated to the Associate Vice President for Human Resources, or designee, to determine COBRA eligibility.

 

For Assistance: Questions regarding COBRA should be directed to Human Resources, Benefits Services Section, or to the website: http://www.utexas.edu/hr/.

 

Source: Consolidated Omnibus Budget Reconciliation Act (COBRA); Public Law 99-272

 

 

Previously HOP 7.A.1