Source: https://www.cga.ct.gov/2008/rpt/2008-R-0682.htm
Timestamp: 2017-02-26 03:16:33
Document Index: 147784867

Matched Legal Cases: ['§ 38', '§ 38', '§ 38', '§ 38', '§ 38', '§ 38', '§ 38']

BACKGROUNDER: COBRA CONTINUATION OF GROUP HEALTH BENEFITS
Topic:HEALTH INSURANCE; Location:INSURANCE - HEALTH; December 5, 2008
2008-R-0682
This OLR Backgrounder provides information about federal and Connecticut continuation of health insurance requirements.
COBRA, the Consolidated Omnibus Budget Reconciliation Act of 1986 (PL 99-272, as amended), amends ERISA, the Employee Retirement Income Security Act, to provide continuation of group health coverage that might otherwise be terminated. COBRA applies to employers with 20 or more employees.
Continuation of coverage is only available when coverage is lost due to certain “qualifying events.” Qualifying events for employees are (1) voluntary or involuntary termination of employment for reasons other than gross misconduct and (2) reduction in the number of hours worked.
4. covered employee's divorce or legal separation;
5. death of the covered employee; and
6. if a dependent child, loss of dependent child status under the plan.
To be eligible for COBRA coverage (a “qualified beneficiary”), the employee, while working, must have been enrolled in the employer's health plan and lost coverage due to a qualified event and the health plan must continue to be in effect for active employees. COBRA continuation coverage will not be available if the employer discontinues all of its health plans. In that case, employees have to seek other coverage.
When an employer cancels all group health care plans, there is no coverage that can be continued. As a result, employees and qualified beneficiaries previously covered through the employer's plans have to obtain coverage elsewhere.
The law requires plan administrators (typically the employer) to give employees and qualified beneficiaries notice of COBRA rights and enrollment information at specific times, as shown in Table 1. In 2004, the DOL issued final regulations that include two notice requirements not specified in the COBRA statute—notice of unavailability of COBRA and notice of early termination of COBRA coverage.
Generally within 14 days after the employee or qualified beneficiary notifies the administrator of the qualifying event. Notice of unavailability of COBRA
Several federal agencies administer and enforce COBRA. The Department of Labor (DOL) and the Treasury have jurisdiction over private-sector health plans. The Department of Health and Human Services has jurisdiction over public-sector health plans.
The Internal Revenue Service has issued regulations on COBRA provisions relating to eligibility, coverage, and premiums. DOL and the Treasury share jurisdiction for enforcing these provisions.
More COBRA information is available at http://www.dol.gov/dol/topic/health-plans/cobra.htm.
When COBRA coverage is not available or is exhausted, a person may have other coverage options, including a spouse's group health plan, an individual policy, or a government program.
Spouse's Group Health Plan. An employee losing coverage may have a right to special enrollment in a spouse's group health plan. HIPAA, the Health Insurance Portability and Accountability Act of 1996 (PL 104-191), requires a group health plan to allow special enrollment for certain individuals to enroll in the plan without having to wait until the plan's next regular open enrollment period. A special enrollment opportunity occurs if a person (1) with other health insurance loses that coverage or (2) becomes a new dependent (e.g., through marriage, birth, adoption). However, the person must request special enrollment within 30 days of losing other coverage or becoming a new dependent.
Individual Policy. An employee losing coverage could convert from the employer's group health plan to an individual policy. HIPAA guarantees eligible individuals access to individual policies. Eligible individuals are those who:
3. are ineligible for COBRA continuation coverage or, if offered such coverage (or continuation coverage under a similar state program), have both elected and exhausted their continuation coverage. Government Program. An employee losing coverage may qualify for health coverage through state or federal government programs. These include Medicaid (for low-income individuals and individuals with special needs), a state children's insurance program (e.g., Connecticut's HUSKY plan), a state high-risk pool (for individuals denied insurance for health reasons, e.g., Connecticut's Health Reinsurance Association), and Medicare (for people age 65 and over, and for certain people who are disabled or have end-stage renal disease). The Charter Oak Health Plan is a new Connecticut program that began accepting applications on June 30, 2008. To qualify for Charter Oak, an individual must be uninsured for six months before enrolling. But applicants may request an exception to this waiting period. The Department of Social Services is finalizing exceptions to this six-month “crowd out” provision. Exceptions may include job loss, financial hardship, loss of HUSKY plan eligibility due to age or income, or exhaustion of COBRA benefits. And, a person who has access to other insurance but chooses not to enroll in it may apply for Charter Oak.
More information about Charter Oak is available at http://www.charteroakhealthplan.com/coh/site/default.asp.
Connecticut law requires employers to comply with COBRA (CGS § 38a-538). It also requires each group health insurance policy, regardless of the number of insureds, to provide continuation and conversion benefits. These are described in CGS §§ 38a-554(b) and (d), respectively (CGS § 38a-546).
CGS § 38a-554(b) requires each group health insurance policy to give individuals the option to continue coverage under certain circumstances until they are eligible for other group insurance. Continuation of coverage is available to an employee and his or her covered dependents if the employee is laid-off, is given reduced work hours, takes a leave of absence, or terminates employment, unless it is for gross misconduct. The employee's spouse and dependent children can continue coverage under a group health plan if the employee dies; there is a divorce, court ordered annulment, or legal separation; or the child loses dependent status.
Continuation of coverage generally extends for the periods of coverage set forth in COBRA. This means that coverage will extend for 18 or 36 months, depending on the qualifying event, and possibly longer if the person has a disability. However, for group health insurance policies issued, renewed, or continued in Connecticut on or after October 1, 2003, an employee and his or her covered dependents also are entitled to continue coverage until midnight of the day preceding the employee's eligibility for Medicare if the employee's reduced hours, leave of absence, or termination of employment results from his or her eligibility for Social Security income.
CGS § 38a-554(b)(4) provides limited continuation of coverage for people with disabilities after a group health plan terminates. Regardless of a person's eligibility for other group insurance, when a group health plan terminates, coverage for covered individuals who were totally disabled on the date the plan terminated continues for 12 calendar months without payment of premium, provided a claim for coverage is submitted within one year of the plan termination. The person receives continued coverage only for claims related to the disability.
CGS § 38a-554(d) requires each group health insurance policy to give Connecticut residents the right to convert to an individual policy immediately upon termination of coverage under the group plan. The terms and benefits offered under the conversion plan must be at least equal to those in an individual comprehensive health care plan as described in CGS §§ 38a-553 and 38a-555.
Plan documents for a group health insurance policy explain how a person can convert to an individual policy. State law does not require employers or insurers to contact people losing coverage to offer the individual conversion plan. Thus, it is up to the individual to request conversion.
In Connecticut, most plans offer conversion through the Health Reinsurance Association, the state's high-risk pool. Information about, and applications for, the Health Reinsurance Association can be obtained by calling the high-risk pool at 1-800-842-0004 or visiting its website http://www.hract.org/hra/index.htm.
People with questions about continuation of coverage and conversion privileges should consult their plan documents and human resources department.
They may also contact the Connecticut Insurance Department's Consumer Affairs Division at 1-800-203-3447. The division can provide a list of individual insurance carriers doing business in Connecticut. The list may also be found on the department's website at http://www.ct.gov/cid/cwp/view.asp?Q=390126&cidNav=|. RELATED OLR REPORTS