Headlines about "Health plan admin - COBRA"
Gathered from the web by the editors at BenefitsLink.com.
[Guidance Overview] COBRA Claim Continues to Trial to Resolve Last-Known Address Issues
"This case highlights the importance of maintaining current and accurate address information for employees and qualified beneficiaries. Will this employer prevail due to the confusion the employee created, or will the inconsistency within the employer's own personnel records preclude it from establishing good faith compliance? Regardless of the outcome, the case reminds employers (and TPAs) with multiple record systems to ensure that addresses are consistent across all systems." (Employee Benefits Institute of America (EBIA))
[Guidance Overview] COBRA Notice Deadline Runs from Employment Termination Date
"This case illustrates COBRA's general rule that the deadline for providing an election notice runs from the date of termination, even if plan coverage extends beyond that date. The statute does provide an alternative, however. If the plan so provides, the notice period (and the maximum coverage period) may instead run from the date that coverage is lost. Given the court's silence on this point, we assume the plan in question was not written to take advantage of this delayed notice rule. The case also contains a helpful discussion of the factors that a court may consider in deciding whether to award attorney's fees or unreimbursed medical expenses incurred during the violation period." (Thomson Reuters/EBIA)
[Guidance Overview] New York District Court Rules No Title VII Retaliation Claim for Employee Who Received Late COBRA Notice
"This former employee had a difficult case to make under Title VII for post-employment retaliation, given that she was not seeking future employment. She apparently did not make a claim for COBRA penalties for the late election notice.... [C]ourts generally hold that a plan administrator can be liable for the penalties regardless of whether the qualified beneficiary was injured or prejudiced, although some courts have declined to award penalties where the qualified beneficiary suffered no actual harm from the late election notice." (Thomson Reuters/EBIA)
[Guidance Overview] Individually-Owned Health Insurance Policy Did Not Preclude Employee from Receiving COBRA Coverage
"As this [Pennsylvania District] court explained, early termination of COBRA coverage is permissible when a qualified beneficiary becomes covered under another group health plan (and other conditions are met). By the terms of the rule, the other coverage must be group health plan coverage -- coverage under an individual policy typically (unless there is certain employer involvement) will not permit termination of COBRA coverage." (Thomson Reuters/EBIA)
[Guidance Overview] When Is Exhaustion of Administrative Remedies Required? A Reappraisal of the Division of Authority
"The district court found Morales-Cotte v. Cooperativa de Ahorro y Credito Yabucoena ... instructive. There, the court examined a similar denial of COBRA benefits and found that the exhaustion requirement applies only where the matter in contention concerns an interpretation of the terms of the plan ('plan-based' claims), and not the terms of the statute itself ('statute-based' claims)." (Health Plan Law)
IRS Audits: Complying with All of the Requirements under COBRA
"By recently posting updated standards for COBRA audits on its website, the IRS may be indicating that an audit initiative is under way relating to COBRA continuation coverage requirements. If so, such an initiative is likely intended to encourage plan sponsors to self-identify and report COBRA failures and pay the associated excise taxes.... The COBRA audit standards provide a preview of what an IRS auditor will do to determine whether a plan sponsor has complied with the COBRA continuation coverage requirements, including documents that will be requested and questions that may be asked." (Thompson Hine)
[Guidance Overview] Once Bitten, Twice Shy: COBRA Excise Tax Audits May Add to COBRA's Bite
"Now, after a 10-year task force study, the IRS has published revised audit guidelines (the 'Guidelines') for COBRA compliance. The stated purpose of revising the COBRA audit guidelines was to incorporate changes to account for new laws that have affected COBRA since the 1994 Guidelines, such as the Health Insurance Portability and Accountability Act (HIPAA) and the Family and Medical Leave Act (FMLA). The updated Guidelines apparently herald a new COBRA compliance audit effort by the Service." (Littler Mendelson)
[Guidance Overview] DOL's New Guidance on SBC Preparation and Delivery
"[T]he FAQs include discussion of SBCs in the context of COBRA, the circumstances that trigger the obligation to provide an SBC (e.g., how the terms 'application' and 'renewal' apply to self-insured plans), the issuers in the individual market, satisfying the 'culturally and linguistically appropriate' requirement, and modifying the prescribed SBC template." (Deloitte)
[Guidance Overview] State-Law Claims Preempted Where COBRA Coverage Was Not Provided under Individual Policy
"This case was fairly straightforward because the employee's COBRA coverage was provided under the employer's plan and not an individual conversion policy. In cases where an individual conversion policy is issued, the law is mixed; some courts have ruled that the individual policy is governed by ERISA because it derives from an ERISA plan, and others have ruled that once an individual conversion policy is in place, it is no longer subject to ERISA." (Thomson Reuters/EBIA)
[Guidance Overview] 15 Things the IRS May Ask Employers in a COBRA Coverage Audit
"[O]n March 26, the IRS posted on its website 'Audit Techniques and Tax Law to Examine COBRA Cases'] which summarizes the COBRA law and the penalties for noncompliance -- and, most key, explains the steps an IRS examiner will take in determining if a 'taxpayer' failed to comply with COBRA. Here, the examiner can request up to 15 pieces of information (the first five items are required)[.]" (Thompson)
[Guidance Overview] Learn Elements of ERISA Plan Status to Help Avoid State-Law Claims
"A former employee's failed attempt to call COBRA coverage a "privately paid" policy, rather than an ERISA plan, in order to maintain state-law claims against a group health insurer offers a chance to remind employers about importance of knowing the legal status of their benefit plans." (SmartHR Manager)
[Guidance Overview] Learn Elements of ERISA Plan Status to Help Avoid State-law Claims
"A former employee's ... attempt to call COBRA coverage a "privately paid" policy, rather than an ERISA plan, in order to maintain state-law claims against a group health insurer [failed] .... The [9th Circuit Court of Appeals] didn't buy that argument based upon the evidence the insurer provided that the plan met ERISA standards.... But [the Court noted that] there is a "safe harbor" regulation that exempts plans that would otherwise be ERISA plans from ERISA's reach[.]" (Thompson / SmartHR Manager)
[Guidance Overview] Despite Multiple COBRA Notice Problems, Court Imposes Nominal Penalty
"This multi-faceted COBRA case is packed with issues, including a rarely seen application of the combined notice rule for a termination shortly after entering a plan. Notably, however, the opinion may have missed the mark in dismissing the employee's dental plan and premium subsidy claims: The court misapplied HIPAA's excepted benefit rules to determine that the dental plan was excused from COBRA's requirements, and seemed unaware that ARRA required plans to provide an additional notice and extended election period to eligible individuals involuntarily terminated from September 1, 2008 through February 16, 2009." (Thomson Reuters/EBIA)
[Guidance Overview] Five Year Limitations Period for COBRA Notification Lapse
"The ERISA statutory scheme is many things, but one thing it is not. It is most definitely not the ''comprehensive and reticulated statute'' (Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134 (1985)) that the federal judiciary has proclaimed. For example, nothing is more basic to a remedial statute than the limitations period that defines its reach." (Health Plan Law)
[Guidance Overview] COBRA and ARRA Rules Misread in Slapping Employer with $500 Notice Penalty
"COBRA experts . . . noted that the opinion includes two points that 'are clearly wrong'; therefore, administrators should not be misled by those conclusions . . . ." (SmartHR Manager)
[Guidance Overview] IRS Updates Form 8928 for Self-Reporting of Excises Taxes Owed for PPACA Failures
"PPACA created several new reporting and compliance standards for plans and employers. The [chart in this document] lists some of those new requirements and their effective dates. Failure to meet any of these must be reported on Form 8928 starting in 2012 as of the due date of the employer's federal income tax return. In general, the penalty assessed under Code ? 4980D is $100 per day, per affected participant for as long as the plan is non-compliant." (Faegre Baker Daniels)
[Guidance Overview] No Extended COBRA Coverage for Disabled Employee Terminated after Reduction of Hours
"As for the employee's argument that a disability extension could be based on an insurer's determination, other courts have held that a plain reading of the statute requires the determination to be made by the SSA. The statutory language requiring a qualified beneficiary to be determined to be disabled 'under title II or XVI of the Social Security Act' seems less than clear on that point, but DOL regulations specifically require a qualified beneficiary to notify the plan administrator that he or she has been determined by the SSA to be disabled." (Thomson Reuters/EBIA)
[Guidance Overview] Must FSAs Offer COBRA to Terminated Employees?
"Issue: Your company will be issuing layoff notices soon. Many employees who will be affected have health flexible savings accounts (FSAs). What are the rules regarding FSAs and COBRA when employment is terminated?" (Wolters Kluwer Law & Business / CCH)
Special COBRA Coverage Terms for the Departing Executive: Pitfalls to Avoid
"Common examples include a period of remaining on active coverage status even after employment responsibilities have largely ceased (for instance during any period in which the executive receives severance compensation), or employer payment of COBRA premiums for some period of time after termination." (E is for ERISA)
[Guidance Overview] Court Considers Whether Reduction of Hours to Zero Triggered COBRA Notice
"The employee's argument that she had a loss of coverage when she was required to make payment other than through payroll deduction is not far-fetched. Another trial court has held that a similar change in the method by which an employee was required to make contributions resulted in a loss of coverage for COBRA purposes." (Thomson Reuters/EBIA)
[Guidance Overview] Court Assesses Penalties for COBRA Notice Violation but Leaves Start Date of Penalty Period Open for Later Decision
"We understand why a court would be confused. By defining a qualifying event as a listed event (e.g., termination of employment) that causes a loss of coverage, COBRA seems to leave the timing question open in situations where the loss of coverage occurs after the listed event." (Thomson Reuters/EBIA)
[Guidance Overview] Summary of Trade Adjustment Assistance Extension Act of 2011, Affecting Health Coverage Tax Credit and COBRA Continuation Coverage (PDF)
"Of note to employers, the 2011 Act modifies the health coverage tax credit . . ., as codified in section 35 of the [IRC] as well as the rules governing health care continuation coverage under [COBRA]." (American Benefits Council)
[Guidance Overview] COBRA Claim Continues to Trial to Resolve Last-Known Address Issues
"This case highlights the importance of maintaining current and accurate address information for employees and qualified beneficiaries. Will this employer prevail due to the confusion the employee created, or will the inconsistency within the employer's own personnel records preclude it from establishing good faith compliance? Regardless of the outcome, the case reminds employers (and TPAs) with multiple record systems to ensure that addresses are consistent across all systems." (Employee Benefits Institute of America (EBIA))
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