COBRA for Expatriates

[Guest Ira Hayes]

A US employer of more than 20 employees hires US citizens to work outside the US for a company which is part of the same controlled group. The employer provides fully insured group health benefits to those employes through a US licensed carrier.

When the employees lose group health coverage, must they be offered COBRA?

[GBurns]

Yes. They are US employees of a US employer with a US benefits plan. Where they go on assignment should not matter.

[Kirk Maldonado]

Treasury Regulation 54.4980B-5, Q-4 provides as follows:

Q-4 Can a qualified beneficiary who elects COBRA continuation coverage ever change from the coverage received by that individual immediately before the qualifying event?

A-4. (a) In general, a qualified beneficiary need only be given an opportunity to continue the coverage that she or he was receiving immediately before the qualifying event. This is true regardless of whether the coverage received by the qualified beneficiary before the qualifying event ceases to be of value to the qualified beneficiary, such as in the case of a qualified beneficiary covered under a region- specific health maintenance organization (HMO) who leaves the HMO's service region. The only situations in which a qualified beneficiary must be allowed to change from the coverage received immediately before the qualifying event are as set forth in paragraphs (b) and © of this Q&A-4 and in Q&A-1 of this section (regarding changes to or elimination of the coverage provided to similarly situated nonCOBRA beneficiaries).

(b) If a qualified beneficiary participates in a region-specific benefit package (such as an HMO or an on-site clinic) that will not service her or his health needs in the area to which she or he is relocating (regardless of the reason for the relocation), the qualified beneficiary must be given, within a reasonable period after requesting other coverage, an opportunity to elect alternative coverage that the employer or employee organization makes available to active employees. If the employer or employee organization makes group health plan coverage available to similarly situated nonCOBRA beneficiaries that can be extended in the area to which the qualified beneficiary is relocating, then that coverage is the alternative coverage that must be made available to the relocating qualified beneficiary. If the employer or employee organization does not make group health plan coverage available to similarly situated nonCOBRA beneficiaries that can be extended in the area to which the qualified beneficiary is relocating but makes coverage available to other employees that can be extended in that area, then the coverage made available to those other employees must be made available to the relocating qualified beneficiary. The effective date of the alternative coverage must be not later than the date of the qualified beneficiary's relocation, or, if later, the first day of the month following the month in which the qualified beneficiary requests the alternative coverage. However, the employer or employee organization is not required to make any other coverage available to the relocating qualified beneficiary if the only coverage the employer or employee organization makes available to active employees is not available in the area to which the qualified beneficiary relocates (because all such coverage is region-specific and does not service individuals in that area).

[GBurns]

What complicates the segment that is in bold is that in some other countries there are either service providers who will provide services under the US policy and accept an assignment to the US insurance company or insurance companies that have an established relationship with either the US insurer or act as an affiliate of a US service provider. That way coverage under the policy is available in that foreign country.

A number of US BCBS already have established relationships with the BCBS in many foreign countries or a local insurer. The same is true of many of the other large insurers especially for Europe, Japan and South and Central America.

BCBS even has a BlueCard Worldwide Service Center to handle the volume of such instances. And this is for non-emergency services.

There have also been reports that there are US BCBS who currently already send some participants to other countries for certain treatment, e.g BCBS of California and BCBS New Mexico (I think Anthem) send people for treatment to Mexico. BCBS and Life of Jamaica accept many US BCBS and insurers even outside the BlueCard program. There are also the reciprocal arrangements that are made by the service providers with service providers in other countries as far away as India.

So it is no longer a given that coverage or service will not be available in another country or region.

I cannot give a link to the programs from Aetna, UHC or some of the large hospitals that have these "International" programs such as Mayo, Cleveland, Miami Heart, Cedars (Miami) etc but here is a link to the BlueCard Worldwide program:

http://www.bcbs.com/bluecardworldwide/