oriecat

Here's the regulations: 26 CFR 54.4980B-2 Q-4: What group health plans are subject to COBRA? A-4: (a) All group health plans are subject to COBRA except group health plans described in paragraph (b) of this Q&A-4. Group health plans described in paragraph (b) of this Q&A-4 are referred to in Sec. Sec. 54.4980B-1 through 54.4980B-10 as excepted from COBRA. (b) The following group health plans are excepted from COBRA-- (1) Small-employer plans (see Q&A-5 of this section); (2) Church plans (within the meaning of section 414(e)); and (3) Governmental plans (within the meaning of section 414(d)). © The COBRA continuation coverage requirements generally do not apply to group health plans that are excepted from COBRA. However, a small-employer plan otherwise excepted from COBRA is nonetheless subject to COBRA with respect to qualified beneficiaries who experience a qualifying event during a period when the plan is not a small-employer plan (see paragraph (g) of Q&A-5 of this section). (d) Although governmental plans are not subject to the COBRA continuation coverage requirements, group health plans maintained by state or local governments are generally subject to parallel continuation coverage requirements that were added by section 10003 of COBRA to the Public Health Service Act (42 U.S.C. 300bb-1 through 300bb-8), which is administered by the U.S. Department of Health and Human Services. Federal employees and their family members covered under the Federal Employees Health Benefit Program are covered by generally similar, but not parallel, temporary continuation of coverage provisions enacted by the Federal Employees Health Benefits Amendments Act of 1988. See 5 U.S.C. 8905a.

That's pretty strange... maybe what it means is that those types of clothes pictured should stay home. It's showing you how not to come? Just a thought...

On another forum I frequent, there was a question about dropping health coverage, not due to open enrollment or a status, but just because someone didn't want it anymore... a poster replied that at her company people can drop the coverage at any time, but because it is a Section 125 plan, they continue the deductions until open enrollment. I can understand the reasoning there, but that seems really legally problematic to me, and I would like to post back about it, but I can't seem to gather my thoughts properly and I was wondering if anyone here had any thoughts on this practice. Would ERISA have anything to say on employees paying for coverage they aren't receiving? It seems like state law might also come into play for improper deductions. I just don't see how a company could legally take this money (and I assume keep it for themselves since they no longer have premiums to pay?) when the employee isn't getting anything in return. The proper thing to do would be not to allow these employees to drop the coverage at all until open enrollment or a qualifying event, right?

My understanding is that if the employee is not overspent, COBRA must always be offered. I believe the standard COBRA requirements would still apply... from the DOL COBRA FAQ - Plan Coverage - Group health plans for employers with 20 or more employees on more than 50 percent of its typical business days in the previous calendar year are subject to COBRA. Both full and part-time employees are counted to determine whether a plan is subject to COBRA. Each part-time employee counts as a fraction of an employee, with the fraction equal to the number of hours that the part-time employee worked divided by the hours an employee must work to be considered full time.

The money doesn't belong to the employer, it belongs to the plan. So no the company can't hold onto it. The plan holds onto. And yes, the plan can continue to carry it over each year. Nothing requires you to clear out the balance at the end of the each plan year. We've been carrying a balance every year now. We reimburse plan expenses and then carry over the rest.

Here's a self compliance list I found on the DOL a couple years ago... http://dol.gov/ebsa/pdf/selfcompliancetool.pdf Here's another one: http://dol.gov/ebsa/pdf/CAGTableOfContents.pdf

Our TPA includes a worksheet on that in the enrollment materials. I don't know if it is the same as/as good as the previous one posted, but here it is (still reflects 2005 figures though...) http://www.abpmtpa.com/pdf/Flex_Worksheet.pdf

Thanks G. So really the answer to the original question, should be no, there is no way to do it tax favored?

Am I misunderstanding something, or doesn't that code say that exemption expired back in 1992?

I'm sorry, but I don't understand what your comments have to do with the original question. These people already made elections and the OP wants to know if they can change them (or have them forced to be changed) in the stated circumstance.

You would need to have a qualified status change to allow the election to be changed. Just making less money or being in arrears wouldn't qualify as far as I know, but perhaps the conditions that are causing such would, as the above poster pointed out, with the working of less hours or something... And of course the plan doc would have to allow a change in those situations...

I've never even thought about the fact that someone might have to pay for an autopsy!

COBRA - Coverage of Blatantly Ridiculous Affordability

I believe the question is regarding FSA's, it's in the title, if not the actual post... that's what my response was replying to. I agree there is no reason to exclude them from a premium portion.

I agree with you and QDROphile.

exclude seasonal employees from eligibility?

Why do you think you would? Unless you specify that the plan doc expires or something...

Definitely possible. Employee elects $1000 Pays $500 through payroll before terming COBRA payments would be the remaining $500 plus 2% or $510 As long as the ee has submitted claims for less than $490, then they can come out ahead by doing COBRA and getting the rest of the $1000 back. If they've already gotten $491, then they can only get $509 back and it would cost them more than it's worth.

It depends upon which state it is...

Section 125 amounts are exempt from FUTA taxation for the employer. The annual base is $7000.

I got the impression that there are two separate issues - the reimbursement on physician charges and a 50% discount on remaining hospital charges... but I could very well be confused

Well that's what the IRS says in Pub 15-B... http://www.irs.gov/publications/p15b/ar02.html#d0e1188 Exclusion from wages. You can generally exclude the value of an employee discount you provide an employee from the employee's wages, up to the following limits. * For a discount on services, 20% of the price you charge nonemployee customers for the service. Is there some reason this wouldn't apply in the above case? Is this discount somehow different?

Just curious, since this is new to me... when doing the 50% discount, do you have to make sure that it isn't more than 20% of the total bill, so that it still qualifies for exclusion from wages? Would that ever be an issue?

If there's a national mandate for chiro, it's sure news to me and my plans that don't offer any... Sounds to me like one of those employees who likes to say "but the law says you have to!"... but they can never actually show you the law they mean...

I think we might need a little more information about what you are trying to do. You cannot force an employee to "pay off the balance" if they terminate, that would negate the employers risk with the plan and violate section 125 regulations.