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How would you not add the child? I think there would be a presumption that the newborn child of a spouse is the employee's child. It may be a rebuttable presumption, but that is for the lawyers to deal with. What is the problem with making the new child a QB? I don't recall anything in the regs that requires the former employee to be the bio parent in order for a newborn child to be a QB. The mother could have been considered a QB in her own right, in which case the child would be a QB. You may know the behind-the-scenes facts this case but you certainly don't want to become the genetic police on every child born to one of your plan participants. The possible nightmares are endless.

Except in very few instances (this not being one of them) COBRA should be effective on the day after the day that active coverage terminates, such that there is no break in coverage. Revoking a waiver would allow the person to accept the original offer under its original terms. Why would you only go back to the date that the waiver was revoked?

Ran into similar situation a couple of years ago, and had to deal with several death claims. Our old plan had an actively at work provision. Our (enhanced) replacement plan has an actively at work provision. We actually charged higher premium on a couple of people. We reversed the payroll errors and provided the inquiring beneficiaries with copies of both life contracts with the applicable provisions highlighted. They weren't very happy about it. I know there were lawyers involved, but no suits were forthcoming following denial/explanation letters. What is "cash-out option"? Our plan is term with no cash value, with a 50% "living benefit" upon substantiated terminal (6 months or less) diagnosis. Would this be the same? Stand your ground (with advice of your counsel).

Mary C, You have precisely described how it goes for my plan. Thanks for your clarity! It's actually heartening to know we are not swimming alone in the ocean and that others face the same issues, and likely from different carriers. Oriecat, I can re-read the earlier posts and easily come to your interpretation. And I, too, would like to have Spinky clarify the facts. Indeed, if the carrier's first notice is from the employer who got their first notice from the employee in March, 1/1 could be the retro date and no COBRA should be offered. This is noted as practice by Mary C, and is what we would do, too.

Oriecat, Granted, under the law it is the employee's responsibility to notify you of qualifying events. And I don't think the carrier did anything wrong per se, but that depends on Spinky's relationship with Spinky's insurance carriers. However, I would be on the warpath if mine started dropping participants without telling me. In message 5, Spinky stated: This doesn't sound like the carrier ever told them of the admin action to delete the dependent. I don't allow my carriers to take this type of action regarding my participants without notifying me. We receive a monthly listing of actions taken by the carrier. Does it catch them all? No, but we miss fewer of them and end up with fewer retros to process. With 40,000 covered lives to track, we need all the help we can get from our carriers to keep it all straight.

Why doesn't your insurer advise you of their administrative actions? You need to correct this with them. This type of stuff, unfortunately, happens all the time. The employee should have notified you within 60 days, but they did not. I suppose you could not send a COBRA notice based on the ee's failure to timely notify. However, you should have been notified of the carrier's administrative actions, but were not. This may (or may not) be enough to make a triable issue. Who is at fault for this, you or the carrier, or both? I don't like trials...too unpredictible. Perhaps you are less risk averse. You may want to offer COBRA based on correction of some administrative oversights. Be sure carrier agrees to accept the late EOBRA enrollment, based on their contribution to the problem caused by their lack of notification of the admin delete action. Premium still goes all the way back which will act as a deterent to the employee. They may not elect, then this just goes away. Document in detail why COBRA is being offered late in this instance so that you have a very narrow set of facts defining the exception, based on correction of a problem. Then fix the process so the problem won't happen again.

I agree with others that HIPAA really doesn't apply here. You may have some other action against the uncle for violating something (your privacy, civil rights, or whatever) but the apparent truth of the statement (notwithstanding the motive) may make it difficult for you to pursue a successful claim. An attorney in your area could probably best direct you. Your sister is lucky to have a brother who is willing to help out in her time of need, even if she doesn't recognize or appreciate it, and especially when you are also having to deal with others who are trying to make it so difficult. God bless you.

So then the answer is "NO" as the loan purpose has no connection to the acquisition of a principal residence??? Correct?

As separate plans, can't you have different definitions? The medical FSA (section 125 cafeteria plan medical expense reimbursement account) definition must comport with IRS regulations. You cannot reimburse expenses incurred for ineligible dependents. However, can't my self-insured medical plan permit participation by almost any dependent I want to define as eligible, as long as the taxation of employee paid premiums, or imputed income value of employer paid premiums, is handled correctly? Example, a domestic partner who works full time or a child over age 24 working their way through college. I can define them as eligible dependents for my medical plan (many plans now do so), but they will not be eligible dependents for whom I can seek reimbursement under under a 125 medical reimbursement account. There is no conflict with the tax code here.

As an employer, you can cover whoever you want, as long as your carriers agree and you handle taxation correctly. You are not required to get any proof at all, if you don't want. FMLA is a federal benefit so a DP is not "entitled" to it. But you can grant DPs the same benefits if you want. CFRA is a California rule. If the DPs meet the requirements set forth in the California Family Code regarding registration, CFRA is an entitlement and you deny it at your own great peril. If the partners are not registered, there is no "entitlement", but you can grant it if you want. (Granting CFRA to care for a DP does not use up FMLA time that the employee could use for themselves or another qualified family member.) We require a copy of the state registration papers for mid-year enrollment based on a "qualifying event", eg. registration of the partnership. At initial enrollment or Annual Enrollment, we will use an affidavit. No proof or affidavit? No coverage under the plan.

Consider your plan administration and employee satisfaction. Not everything that employees submit will be covered in any event. Why would you want to limit this further with an [arbitrary?] employer rule? I have found it much easier to be in full conformance with the law; that way, if something must be denied, it's because of those darned old IRS regulations not because of some employer-initiated policy that was a good idea when implemented long ago, but we can't remember why.

Not withstanding AB 2208, California also passed AB 205 which confers certain rights on domestic partners as defined in Section 297 of the California Family Code. Our counsel has opined that, as an employer, we must extend to a registered domestic partner basically EVERY benefit that we would extend for a spouse. Perhaps we're a little different being (a governmental body) not subject to ERISA, but this extends to family sick leave usage, bereavement leaves, and the California Family Rights Act, which is similar to FMLA but expansive in some important ways. I'm not sure if you can get around AB 205.

DP benefits cannot be offered under a "cafeteria" plan. Income must be imputed (federal taxes, state taxes may or may not apply) for the value of the employer-paid portion of the benefits and any employee-paid amount must be taken post-tax (again, state tax laws may vary).

Employee is promoted. Changes from one union affiliation to another. Original union provided 100% reimbursement of family health premium. New union provides 80% reimbursement, resulting in employee cost of approx. $180 per month for same plan. Employee wants to drop dependent coverage because of the new out-of-pocket cost. (Dependent has long-standing other coverage in place.) No change in plan eligibility has occurred, just employer reimbursement. Would you permit employee to drop dependent due to "significant change in cost"?

As with Oriecat, our plans would automatically cover a newborn for the first 30 days. In this case, no enrollment would be required. However, if your health plan requires enrollment (and then disenrollment), it should be permitted. Regarding the FSA, since changes can only be made on a prospective basis I don't see how you can go back and change FSA contribution limits to cover the expenses of the newborn.

How many bids have there been for more than the minimum increment?

All in favor say "Aye". Aye! All opposed, "No". Well, the "eyes" are above the "nose", so you win!! It's official.

I'm in the camp of "Don't mess with COBRA". If your ee pays by the date specified by the TPA, you'd probably better accept it. If no payment, follow QDROphile's advice, send the loss of coverage letter and hope for the best. With any luck, the ee didn't submit any big claims for late December. The ee paid (even though they could have let it "float") and probably now has other coverage. You are ahead by the 1/2 month of premium that was paid! Throw a party, thank your lucky stars, and move on.

In our unionized environment, there are specific guidelines about when a payroll or reimbursement error can be collected. For some things, it is specifically stated as one year. For others, we can (and do) go back many years. But one year is pretty much the minimum acceptable look-back period. Which part of the previous "unjust enrichment" statement does not apply to you? They made an error. If you made an extra payment (in error) on a bill, would you expect to be reimbursed, or at least credited for the overpayment? Because of tuition reimbursement, I gather you are taking classes. Does your institution offer any remedial classes in ethics and integrity?

I agree that it is ultimately the sole responsibility of the employee to provide the information needed to support his claim. It sounds like he is trying can't get cooperation from the provider. There should not be much jeopardy. Oh, I suppose a good attorney on a subsequent claim could construct a theory about your NOT helping out his employee-client when they couldn't get info from a provider to support a claim, but that would be a stretch, and you could mitigate it by helping all of your employees (precious few, I would imagine) who find themselves with the same problem. Was the manager directly insubordinate in ignoring a valid order from an authorized superior in your company when he called the provider? If so, you have a personnel issue with the manager that you need to address. Even if so, this manager sounds like a pretty decent human being who actually cares about his employees. Your company should try to find more like him. He's improving morale and your employee relations. I empathize with the employee who can't get cooperation out of his provider. What is wrong with trying to help by having a manager rattle a cage or two? Is the provider affiliated with your health plan in a way that your benefits manager can lean on the health plan service manager to get compliance out of the provider? Help the employee out if you can. If it is indeed the provider who won't cooperate, why do you want to punish your own employees for the provider's failure? I don't get it...

How many loans does the plan allow? If unlimited, looks like you could make subsequent loans until you reach the statutory max outstanding. If only 2 loans are allowed, like our plan, once you take the new $10K loan, you're done until 15 days after you pay off at least one of the loans.

Mal, Yes, very nice benefit. Very benevolent. What a wonderful employer! Sign me up... I think (for the future) you could still set up the plan to trigger COBRA and satisfy the employer's obligation. But as noted by KJohnson, this should entail an election between COBRA and the "alternative coverage" of the disability plan paid health insurance benefits. If you are unionized, good luck with that take-away.

Was disability the result of a work related injury? If so, and depending on the state you're in, workers' comp laws may dictate how you would "normally" want to handle this type of situation. Is the 2 year extension of benefits part of a union or other agreement, or has this person just "fallen through the cracks" for the past 2 years? Based on the limited facts presented, offer COBRA as of the date coverage will be lost in March, 2005. If it is not the intent of your company to provide coverage for this length of time, review your policies and union agreements, and send COBRA offers when the reduction of hours occurs. However, you will need to be prepared to terminate coverage if someone does not positively respond to your offer of free coverage. As noted above, check your workers' comp laws if the reduction in hours is due to accepted industrial injury.

How can it be "His own money" if an employee can collect it before "paying" it into the plan? Wouldn't that be like borrowing against future wages with some sort of obligation to repay, which is clearly not part of an FSA plan?

An option my FSA TPAs have always offered (and we've always declined) is to deposit all salary reduction money with them. That way the funds are "instantly" available to pay participant claims on a daily basis without the bother of our having to transfer money to them. We pay FSA claims every 2 weeks and have seen no reason to move to daily. They would, of course, return anything that is unused following the plan year claim filing deadline. I suppose I could negotiate with them to use interest earnings to offset their fees. The payment of FSA claims is just a cash flow issue. Why wouldn't the company manage it as such, doing the same thing with extra FSA money as it does with any other funds that are not immediately needed? Even leaving the money in the corporate bank account is an investment to the extent that it would be taken into account by the bank in calculating your monthly bank charges.