COBRA (Self Payment) Rules
COBRA Eligibility
If you cease to be an active participant for any reason
other than gross misconduct, you have the right to continue
your Health Benefits for a period of up to 36 months,
starting from the date your employer terminates Welfare
Contributions on your behalf. Immediate notification of
termination must be given the Fund Office in order to
maintain your health insurance benefits through direct
payments.
- Your spouse (husband or wife) may also continue his
or her Health Benefits on a direct payment basis under
any of the following circumstances:
- upon your death (providing you were eligible at the
time of death).
- upon divorce or legal separation from you.
- upon your termination of employment for retirement
or any reason other than gross misconduct.
Your dependent children (as defined in the plan) may also
continue their health benefits on a direct payment basis
under any of the following circumstances:
- upon your death (providing you and such dependent
child were covered for benefits at the time of your
death).
- upon termination of your employment (providing your
child was covered at the time of such termination or was
born or placed for adoption while the COBRA provisions
were in effect.
- upon your divorce or separation.
- upon the date your eligibility ceases due to
retirement or any reason other than gross misconduct.
- the date your dependent child ceases to be a
dependent (due to age, change in student status, etc. –
see definition on page 1).
- Your spouse and your dependent children (where
applicable) will have the option to continue their Group
Health Benefits for a period up to 36 months.
Termination of COBRA Benefits
The Group Health coverage under COBRA will
automatically cease if:
Self payments are not received when due.
You or any of your dependents become covered under
another Group Health Plan (including Medicare).
A divorced spouse or widow remarries and becomes covered
under another Group Health Plan.
You return to work for an Employer who is obligated to
make contributions on your behalf.
Notification and Filings
In the event your employment is terminated for any reason
other than gross misconduct, you should immediately notify
the Fund Office if you wish to continue your Group Health
Benefits. You will then be furnished with the forms and
instructions as to how to continue your health benefits on a
direct payment basis.
You (or any family member) must also notify the Fund
Office of any divorce, legal separation, or change in a
dependent’s child’s status (i.e. attainment of maximum age,
change in student classification, marriage) which might
result in loss of Group Health Benefits.
Under the new law, you or one of the family members have
up to 60 days to file your election with the Fund
Administrator for continuation of Group Health Coverage on a
direct payment basis and another 45 days to make the
required self payments.
Group Health Benefits
You or an eligible dependent, who qualified under the
direct payment provisions set forth above, will be covered
for Empire Blue Cross Blue Shield Hospital and Medical
Benefits, plus supplemental Comprehensive Medical,
Prescription Drug, Dental and Vision Benefits in effect on
the date such coverage was scheduled to be terminated. There
will be no continuation of the Employee Group Life
Insurance, or Employee Weekly Supplemental Disability
Benefits under this section of the Plan.
The amount of the direct payment will be based on the
group rate for your particular class of benefits. These
costs may change from time to time, based on the actual
claim experience of the group. In any event, the amount of
the monthly Direct Payment required to maintain your Health
Benefits or that of your dependents will be furnished upon
request.
Termination of COBRA Due To Coverage Under Another
Plan
As you may know, COBRA coverage may be terminated for any
participant when he or she becomes covered under another
group health plan, even when that plan contains a
preexisting condition exclusion or limitation. However,
under the provisions of the Health Insurance Portability and
Accountability of 1996, those plans that do have preexisting
condition limitations must now conform to regulations which
limit the circumstances under which plan s can apply the
exclusions for a preexisting condition. This new law limits
the preexisting condition exclusion period to a maximum
period of twelve months, and also requires all plans to give
credit for any prior period of continuous health coverage
under another plan. A period of prior coverage is not
considered continuous if the individual had no health
coverage for a 63 day period between his or her "old plan"
and the new plan. Where coverage is not continuous, no
credit for prior coverage is required. Where coverage is
continuous, the period of coverage under the old plan will
be credited to satisfy the waiting period for pre existing
conditions.
Example
Joe Participant has been covered under the group health
plan for 20 months. When he terminates employment, he elects
COBRA continuation coverage under the plan. At the time that
he elects COBRA coverage, he has a specific health problem.
At the end of the fifth month of his COBRA continuation
coverage period, he gets a new job and enrolls in his new
employer’s group health plan. As permitted by law, the new
plan excludes coverage for preexisting conditions, including
Joe’s specific health problem, for 12 months. In determining
whether Joe is subject to the 12 month preexisting condition
exclusion period, his new employer must credit him with the
25 months of coverage he had under his prior employer’s plan
(because there is no break in coverage of 63 days). Since
Joe had been covered under his first employer’s group health
plan for at least 12 months immediately prior to becoming
covered under his new employer’s plan, he is not subject to
the preexisting condition exclusion. For this reason, Joe’s
prior plan may terminate his COBRA coverage.
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