oriecat

These parts of the Regs might be useful to you: http://www.dol.gov/dol/allcfr/ESA/Title_29...9CFR825.203.htm http://www.dol.gov/dol/allcfr/ESA/Title_29...9CFR825.204.htm

Many states are mandating coverage for dependents at older ages, or plans are making the changes on their own. How are you supposed to handle the premiums when you might have some dependents that qualify under IRS rules and some that don't? For example: EE elects coverage for Self & a qualifying child. Let's say the premium is $300 a month. This is paid pretax. At open enrollment, they add another child to the plan. This child does not qualify under IRS rules, but does under other rules. Premium is still $300, because it's one price regardless of the number of dependents. Can you still pretax the whole $300, or does part of it now need to become after tax? (Note, no ER contribution to the dependent coverage, so we don't need to get into imputed income.) Thanks for any thoughts.

Even if they could (which I think will depend upon when the new coverage starts and when the COBRA was elected), why would they want to when they won't have any pretax advantage to it?

If they remain covered as dependents under the plan, they get the same 18 months of COBRA as the employee. The additional 18 months only begin to apply if for some reason they are no longer eligible as dependents, but moved to their own plan, such as death, divorce, or loss of eligibility due to dependents age. This would need to be an official second Qualifying Event. Yes. The only extension of time available to the employee is the Social Security Disability extension. As for (3), no idea. I don't have to deal with retiree plans at all.

Agreed. If you're not eligible as a dependent, you can't stay on as a dependent, whether it's COBRA or active employee coverage.

Just curious, how much money are you talking about here?

Aren't you in effect denying the claim, due to incomplete documentation, and wouldn't this then need to fall under the claims appeal process?

It says that in Q1 not in Q4. I think it is referencing different circumstances. I don't see how it says that. It says employer action to end employment due to illness or disability is an involuntary termination. It says simply being absent due to the illness or disability is not an involuntary termination, until the employer takes the above action to end employment.

I think it depends. Are you terminating the employment due to the inability to return to work, or will they still employed in an inactive status? We have always administratively terminated employees when they exhaust their FMLA and cannot return to work yet. In that case, I think subsidy will apply, based on that Q4. I think if you were to leave them employed and give them COBRA due to reduction in hours or something, then subsidy would not apply.

Do you mean from a payroll side or an administrator side? I asked some people on a payroll forum I belong to and people there said it can be done for the payroll side, but it can sometimes mean some special programming, in regards to matches and priority of the deductions.

It's called the Uniform Coverage Rule. It applies to Health FSAs, but not to Dependent Care FSAs.

Thanks Christine!

I have also heard the same as jpod posted, and someone said it was in the DOL webcast.

29 CFR 825.200 http://www.dol.gov/dol/allcfr/ESA/Title_29...9CFR825.200.htm (h) For purposes of determining the amount of leave used by an employee, the fact that a holiday may occur within the week taken as FMLA leave has no effect; the week is counted as a week of FMLA leave. However, if an employee is using FMLA leave in increments of less than one week, the holiday will not count against the employee's FMLA entitlement unless the employee was otherwise scheduled and expected to work during the holiday. Similarly, if for some reason the employer's business activity has temporarily ceased and employees generally are not expected to report for work for one or more weeks (e.g., a school closing two weeks for the Christmas/New Year holiday or the summer vacation or an employer closing the plant for retooling or repairs), the days the employer's activities have ceased do not count against the employee's FMLA leave entitlement. Methods for determining an employee's 12-week leave entitlement are also described in Sec. 825.205.

I don't think having the 2nd QE cancels out the first one. They would still have a QE of termination of employment, and then an additional QE, that gives them additional coverage time. The COBRA begin date still goes from the date of the 1st QE. So I agree with jstorch and think the child would be an AEI.

Thank you, that has been my current understanding as well.

Why would he have to answer No to #4? If he filled out the form today, he is not eligible for any other coverage right now.

I was thinking the same thing first myself, but upon reading the documentation again, and looking at the form the DOL created, I am not sure. Look at the qualifying questions on the "Request for Treatment as as AEI" form... To qualify you must be able to check "yes" for all statements 1. The loss of employment was involuntary 2. The loss of employment occurred at some point on or after 9/1/08 and on or before 12/31/09 3. I elected (or am electing) COBRA continuation coverage. 4. I am NOT eligible for other group health plan coverage (or I was not eligible for other group health plan coverage during the period for which I am claiming a reduced premium 5. I am NOT eligible for Medical (or I was not eligible for medicare during the period for which I am claiming a reduced premium. I think this guy could say Yes to all of these, if he completed the form after March 15th. Neither the instructions nor the form say that the yes has to be as of the effective date of 2/17 or 3/1. But that's just my take right now, and am open to being shown otherwise!

(b) should actually read "he elects COBRA (when first offered or during the additional election period provided by ARRA), so you cannot say that he does not satisfy (b) yet, when he hasn't had the new opportunity yet. I think he qualifies, based on my reading.

The instructions I posted above, with the bolded AND statement.

Ow, my head. So you are saying that they said that you have to send the new General Notice to every QB since 9/1, regardless of the reason, even if they don't qualify, and in contrast to the instructions on the webpage now?

Seems that the DOL webpage has been updated to fix some of this confusion: http://www.dol.gov/ebsa/COBRAmodelnotice.html General Notice (Full version) Plans subject to the Federal COBRA provisions must send the General Notice to all qualified beneficiaries, not just covered employees, who experienced a qualifying event at any time from September 1, 2008 through December 31, 2009, regardless of the type of qualifying event, AND who either have not yet been provided an election notice or who were provided an election notice on or after February 17, 2009 that did not include the additional information required by ARRA. This full version includes information on the premium reduction as well as information required in a COBRA election notice. Someone on another forum I use said they just attended the DOL webinar and "They repeatedly said throughout the webinar that only AEIs get the notice and that you don't have to send it to everyone."

Nothing in any of the documents I have seen separates out "premium" vs "admin fee". It is all just "COBRA premium", which in my mind, at least, means the employer premium plus the 2%. And employees pay 35% of the COBRA premium.

Hmm. Well the COBRA notice regs say "(xi) A description of the amount, if any, that each qualified beneficiary will be required to pay for continuation coverage;" (29 CFR 2590.606-4(b)(4)(xi)) I would think this would still apply under the new notices, which would be why the DOL included both amounts in their models.

I modified my COBRA rate chart to include both the full premium and the subsidized rate, with a note at the bottom saying that the subsidized rates apply only to qualified Assistance Eligible Individuals, for no more than 9 months. I certainly think it is a good idea to let them know, otherwise you risk either lots of miscalculated premium payments or lots of phone calls, both of which I prefer to avoid.