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Dependent Eligibility - ongoing verification


Guest Benny Comply
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Guest Benny Comply

Can anyone please share their experience with ongoing dependent verification for new hires and permitted election changes?

As sponsor and administrator of a self-funded welfare plan, we have conducted several periodic dependent audits. We are now implementing a process to verify eligibility of a dependent upon request for enrollment in the Plan. Our TPA has indicated that to pend elections until the proof is furnished would be very costly. So, instead we are opting to permit enrollment in the Plan, then request that the employee send documentation to verify eligibility for coverage.

The questions are:

1) if documentation is not provided timely, should we terminate coverage retroactively since the individual is considered ineligible for coverage, or should we drop coverage prospectively.

2) if we term coverage retroactively, must it be done within a prescribed period of time? (is there a duration after which they could be "deemed" acceptable for coverage under the Plan?) And, if retro term'd, I assume COBRA should not be offered?

3) if we just drop coverage prospectively, which means we allowed the person to be covered under the plan for a period, would we then have to offer COBRA?

Any input is appreciated.

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