COBRA Notice After Termination Or Other Qualifying Event
COVER
LETTER
As
you know, your medical coverage through [employer] ceases on termination
of your affiliation with [employer]. Under federal legislation, you and
your covered dependents (if any) have the right to elect up to 18 months of
continuation coverage. You will be able to extend your coverage for a total of
29 or 36 months in certain situations.
Attached
is a package that describes this option in detail. If you desire to continue
your medical coverage, you should follow the instructions for completing the
enclosed notice of continuation of health care coverage form.
If
you have any questions, please call me at [telephone number].
NOTICE TO PERSONS TERMINATING SERVICE WITH
[EMPLOYER] AND THEIR SPOUSES AND DEPENDENT CHILDREN
*IMPORTANT NOTICE--READ CAREFULLY*
SUBJECT:
Health Care Continuation
In
accordance with federal law, you have the right as a former employee or as a
spouse or dependent child to purchase continuation of health coverage because
the employee’s service with [employer] has terminated. This means that
you may continue coverage that you had on the date of the termination of
service under any of these plans:
•Major
medical plan
•Health
maintenance organization
•Dental
benefits plan
•Dental
maintenance organization
•Flexible
benefits plan
I. What You May Elect
You
may elect to continue your coverage under one or more of these plans. At the
present time, you may not change the plans under which you wish to continue
coverage. Moreover, you may not enroll in a plan for which you were not
enrolled when the employee left [employer].
Because
the employee’s service with [employer] has terminated, you may elect
(the spouse and dependent children, if any, may separately elect), without
providing evidence of insurability, to continue your group coverage for up to
18 months. At the end of the 18-month continuation period, you will have a
conversion right to purchase individual medical coverage.
II. When Continuation Coverage Ends
Your
continuation of coverage will end if any of the following occurs:
1.[Employer]
terminates all of its health benefits;
2.Payment
of either the premium for retroactive coverage or a subsequent monthly premium
is received by [employer/insurer/plan administrator] after the grace
period has expired;
3.You
become covered under another group health plan;
4.You
become entitled to Medicare benefits; or
5.You
are no longer disabled (if you were disabled at the time of your separation
from service or within 60 days of the beginning of continuation coverage).
III. How to Elect Continuation Coverage
The
cost of continuation coverage for you and your dependents, if any, is indicated
on the following Election of Continuation of Health Care Coverage form.
If
you are the former employee and you wish to obtain this coverage for yourself
and your dependents, you must complete and return the Election of Continuation
of Health Care Coverage form within 60 days of the date that you receive it.
(If you are the spouse or dependent child and wish to make a separate election,
you must obtain additional election forms from [name].) The form must be
sent to the address indicated on the election form.
The
envelope in which you mail your election form must be postmarked no later than
the sixtieth day after the day on which you receive this notice from [employer].
If you do not elect to purchase the continuation coverage within the 60 days
permitted for the election, your health benefits will not be continued and you
will not have another chance to purchase the continuation coverage.
You
should submit your election form as soon as possible after receiving this
notice in order to prevent any delays in receiving any medical or dental
benefits and to avoid the possibility of losing your benefits altogether. No
claims for benefits or services incurred will be considered for payment until
you have submitted your election form and paid the application fee.
IV. Application Fee and Initial Premium
Payment
There
is an application fee set forth on the following Election of Continuation of
Health Care Coverage form. It is important that your check for the application
fee accompany the election form. You will not preserve your right to a
continuation of your coverage unless this payment is submitted with your
election form.
The
premium for one full month of coverage, payable to [employer/ insurer/ plan
administrator], should also be paid with your election form, but it need
not be paid at this time in order for you to make a valid election of
continuation coverage. The premium due for the retroactive period of coverage
(from the termination date to the date of your election), if any, must also be
paid. Both amounts must be paid within 45 days of the date that you submit your
election.
V. Subsequent Monthly Premium Payments
After
your election is processed, you will receive monthly bills. Your first monthly
bill will reflect any adjustments required to convert your premium payment
method to a calendar-month basis.
Even
though there is a 45-day grace period applicable to the premium payment for the
retroactive period of coverage (see the following discussion of grace periods),
it is important that you pay this bill promptly. The premium due date for the
retroactive period of coverage is the date that you submit your election form.
The premium due date for monthly premiums thereafter is the first day of each
month.
VI. Grace Periods
There
is no grace period for your application fee. That fee must be included with
your election form. A grace period of 45 days is allowed for the premium for
the first full month of coverage beginning after the date of your election and
for the retroactive period of coverage (from the date that your coverage ended
until the date that you submit the election form).
A
grace period of 30 days will be allowed for each subsequent monthly premium.
This 30-day grace period does not apply to the premium for the first period of
coverage beginning with the date of your election.
VII. Declining Coverage
If
you do not wish to purchase continuation coverage, you need do nothing. Do not
return the election form.
VIII. Electing More Coverage
You
may be eligible for more coverage in certain situations. You can apply for a
total of 29 or 36 months of coverage, depending on the situation. If you are
the spouse or dependent child of the covered employee, you may extend your
original 18 months of coverage for a total of up to 36 months of coverage. You
may elect this additional coverage if you have a second qualifying event
(listed previously) during your original 18 months of coverage.
If
you are determined by the Social Security Administration to be disabled at the
time of or within 60 days of termination or reduction in hours resulting in
loss of group coverage, and if you are willing to pay a higher premium, you can
extend your original 18 months of coverage up to a total of 29 months if you
notify [plan administrator] both within 60 days of that determination
and before the end of the first 18 months of coverage. Likewise, if your
dependent children are determined by the Social Security Administration to be
disabled, they can extend their coverage up to a total of 29 months if they
notify [plan administrator] both within 60 days of that determination
and before the end of the first 18 months of coverage. The premiums charged for
the coverage will be increased nearly 50 percent during the period of
disability.
IX. Your Obligations
In
order to properly elect your continuation of health coverage, you must submit
your election form along with the application fee within 60 days of the day
that you receive this notice.
You
must pay your premiums, set forth in the election form and in any subsequent
bill, within the applicable grace period. Premiums will be too late if we
receive them after the grace period ends (45 days after submission of the
election form and application fee in the case of premiums due at the time of
your election and 30 days in the case of all other premiums).
If
you subsequently encounter another qualifying event, such as a divorce, during
your initial 18 months of coverage, you must notify [plan administrator]
if you wish to extend your coverage for a total of 36 months.
If
you are determined by the Social Security Administration to be disabled at the
time of or within 60 days of termination or reduction in hours resulting in
loss of group coverage, and you want to extend your coverage up to a total of
29 months, you must notify [plan administrator] both within 60 days of
that determination and before the end of the first 18 months of your coverage.
You must notify [plan administrator] within 30 days of any final
determination that you are no longer disabled.
Likewise,
if your dependent children are determined by the Social Security Administration
to be disabled at the time of or within 60 days of termination or reduction in
hours resulting in loss of group coverage, and they want to extend their
coverage up to a total of 29 months, they must notify [plan administrator]
both within 60 days of that determination and before the end of the first 18
months of their coverage. Your dependent children must notify [plan
administrator] within 30 days of any final determination that they are no
longer disabled.
The
law requires that you notify [employer/plan administrator] within 60
days of when you become covered under another group health plan. Notice to this
effect must be sent to [address to which premium payments are sent].
X. Additional Information
If
you have questions concerning your right to purchase continuation coverage,
please contact [manager in charge of employee benefits].
In
the event that [employer] changes the medical or dental benefits
available to similarly situated persons, their spouses, or their dependent
children, those changes will be extended on the same basis to persons who have
purchased continuation coverage. The cost of the continuation coverage will be
adjusted to reflect the change in your continuation coverage benefits.
Craig Casey is an Writer, Coach, Blogger, Husband, and Former Health Insurance Agent helping people on the web since 1999 with their health insurance problems.
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