PEBB Initial Notice of COBRA and Continuation Coverage Rights

Transcription

1 PEBB Initial Notice of COBRA and Continuation Coverage Rights You are receiving this booklet because you recently enrolled in Public Employees Benefits Board (PEBB) coverage. It explains how you can continue PEBB health coverage after it ends. This booklet also explains how and when to notify us when these events occur: Death Divorce Termination of a state-registered domestic partnership A child loses eligibility To continue PEBB coverage, you must follow the notice procedures and timeframes for reporting these events. The forms and instructions you need are available at or by calling the PEBB Program at Please keep this booklet for future use. HCA (12/12)

2 PEBB contact information You may obtain information about PEBB eligibility and continuation coverage from: Mailing address Health Care Authority PEBB Program P.O. Box Olympia, WA Street address Health Care Authority PEBB Program 626 8th Avenue SE Olympia, WA Monday through Friday, 8 a.m. to 5 p.m. or (Olympia area) Notify the PEBB Program of address changes To protect your rights and the rights of your family, you should keep your employer (if an employee) or the PEBB Program informed of address changes for all family members. You can do this by contacting your employer s personnel, payroll, or benefits office, or contacting the PEBB Program at or in writing. You should also keep a copy of any notices you send to your employer or the PEBB Program for your records. You may find the Public Employees Benefits Board s existing laws in chapter of the Revised Code of Washington (RCW), and rules in chapters , , , , and of the Washington Administrative Code (WAC). These are available on the Office of the Code Reviser s website at 2 To obtain this document in another format (such as Braille or audio), call TTY users may call this number through the Washington Relay service by dialing 711.

3 Table of contents Introduction... 4 What is COBRA?... 5 What other continuation coverage options are available under PEBB rules?... 5 Who is entitled to COBRA?... 5 Who is entitled to PEBB Extension of Coverage?... 6 Who is entitled to Leave Without Pay (LWOP) coverage?... 6 When is continuation coverage available?... 7 Who can choose continuation coverage?... 7 How long does continuation coverage last?... 8 When can continuation coverage be extended?... 9 Disability extension of coverage... 9 Second qualifying event extension of coverage... 9 How do I provide notice if I lose eligibility for PEBB coverage? When is payment due? If you have questions

4 Introduction You are receiving this notice because you have recently enrolled in health plan coverage under the Public Employees Benefits Board (PEBB) Program. The PEBB Program is administered by the Washington State Health Care Authority (HCA). This notice generally explains: COBRA and other continuation coverage options. When these options may become available to you or your family members. What you or your family members will need to do to protect the right to continue PEBB health plan coverage. COBRA and other continuation coverage become available to you and your covered family members when PEBB health plan coverage would otherwise end because of a life event, referred to as a qualifying event in this notice. Specific qualifying events are listed later in this notice. After a qualifying event occurs and any required notice of that event is properly provided to the PEBB Program, we will send a Continuation of Coverage Election Notice booklet to you or your covered family member who loses PEBB coverage. This booklet provides forms and notice procedures for you or your family member to follow to continue PEBB coverage. This notice does not fully describe COBRA or other continuation coverage options available under the PEBB Program. If you have questions about this notice or your eligibility for continuation coverage, refer to the Continuation of Coverage Election Notice booklet at or contact the PEBB Program. (See PEBB contact information on the inside front cover.) If you are enrolled in a PEBB flexible spending account (FSA) and your employment ends, you can elect to continue your FSA coverage through ASIFlex. You must contact ASIFlex at or via to asi@asiflex.com no later than 60 days after the date ASIFlex provides notice of your continuation right. You can also find more information in ASIFlex s 2013 FSA Enrollment Guide online at pebb.asiflex.com. Continuation coverage provides the same medical and dental benefits and cost-sharing available to other PEBB members, but for a temporary period and with no employer contribution you pay the full cost of coverage each month from the date you lose PEBB coverage. 4

5 What is COBRA? COBRA, created by a federal law the Consolidated Omnibus Budget Reconciliation Act of 1985 is a temporary extension of PEBB group health coverage governed by federal law and regulations. Subscribers (employees or retirees), their spouses, and their dependent children are qualified beneficiaries under federal law. Certain newborns, newly adopted children, and alternate recipients under a National Medical Support Notice (NMSN) may also be qualified beneficiaries. The event that caused you or your covered family member to lose PEBB health coverage is called a qualifying event, and the date of that event is called the date of your qualifying event. Each qualified beneficiary (as defined under COBRA) is entitled to elect COBRA to continue PEBB health coverage. Qualified beneficiaries who elect COBRA must pay for COBRA coverage. The type of qualifying event determines the maximum coverage period available. All other individuals who are not qualified beneficiaries may qualify for other continuation coverage. What other continuation coverage options are available under PEBB rules? The PEBB Program also administers two other temporary continuation coverage options that may be available to you: 1. PEBB Extension of Coverage An alternative created for PEBB members who are not qualified beneficiaries, and therefore not eligible for COBRA. Monthly premiums are the same as for COBRA. 2. Leave Without Pay (LWOP) An alternative available to PEBB members in specific situations. Monthly premiums are the same as for COBRA. You can find monthly premiums for these continuation coverage options at by selecting the Rates link, or by calling the PEBB Program. In addition, PEBB retiree insurance is available to employees and survivors who meet eligibility and procedural requirements as described in Washington Administrative Code (WAC): Retiring employees as described in WAC Surviving dependents of emergency personnel killed in the line of duty, as described in WAC Surviving dependents of employees and retirees, as described in WAC You can find these rules at in the PEBB Rules and Policies section. For detailed information on retiree eligibility, enrollment, premiums, and available plan options, refer to the PEBB Retiree Enrollment Guide. You can find this at by selecting the New Retiree link under Enroll for 2013 or by calling the PEBB Program to request one. Who is entitled to COBRA? Qualifying events for the covered employee As an employee, you can choose COBRA to continue PEBB medical and/or dental coverage if you lose coverage because: Your hours of employment are reduced. Your employment ends for any reason other than for gross misconduct. Qualifying events for the retiree As a retiree, you can choose COBRA if you lose PEBB coverage because: Your employer group ceases participation in PEBB insurance coverage. (School district and educational service district retirees can continue their PEBB retiree coverage, even if their district discontinues participation or never participated with the PEBB Program.) The Department of Retirement Systems (DRS) has determined that you are no longer disabled, so your pension has stopped. Qualifying events for the covered spouse As a spouse, you can choose COBRA if you lose PEBB coverage because: Your spouse (the employee or retiree) dies, and you don t qualify for surviving spouse coverage. Your spouse s (the employee s) hours of employment are reduced. Your spouse s (the employee s) employment ends for any reason other than for gross misconduct. You divorce. If your spouse (the employee or retiree) reduces or cancels your PEBB coverage in anticipation of a divorce, and a divorce later occurs, then the divorce may be considered a qualifying event for you even though you lost coverage before the divorce. 5

6 Qualifying events for covered children (including children of a domestic partner covered by the employee or retiree) As a child, you can choose COBRA if you lose PEBB coverage because: Your parent (the employee) dies. Your parent s (the employee s) hours of employment are reduced. Your parent s (the employee s) employment ends for any reason other than for gross misconduct. You no longer qualify as a dependent child under PEBB rules. Who is entitled to PEBB Extension of Coverage? Under COBRA, only the employee, retiree, spouse, and dependent children covered under the plan on the day before the qualifying event are considered qualifying beneficiaries. A domestic partner is not considered a qualifying beneficiary, even if state law recognizes him or her as the subscriber s spouse. This is because of a federal law called the Defense of Marriage Act (DOMA). To offer the same opportunity to continue PEBB coverage to domestic partners, the PEBB Program created PEBB Extension of Coverage. Qualifying events for state-registered domestic partners As a domestic partner, you can choose PEBB Extension of Coverage if you lose PEBB coverage because: Your domestic partner (the employee or retiree) dies, and you do not qualify for surviving domestic partner coverage. Your partner s (the employee s) hours of employment are reduced. Your partner s (the employee s) employment ends for any reason other than for gross misconduct. Your domestic partnership is terminated. If your domestic partner (the employee or retiree) reduces or cancels your PEBB coverage in anticipation of the domestic partnership s termination, and a termination later occurs, then the domestic partnership termination may be considered a qualifying event for you even though you lost coverage before the termination of the domestic partnership. Who is entitled to Leave Without Pay (LWOP) coverage? Qualifying event for the covered employee As an employee, you can choose LWOP coverage to continue PEBB medical, dental, or life insurance coverage (and in some cases, long-term disability coverage) for yourself and your covered family members if you lose PEBB coverage because: You are on authorized leave without pay. You are on approved educational leave.* You are receiving time-loss benefits under workers compensation. You are called to active duty in the uniformed services, as defined in the Uniformed Services Employment and Reemployment Rights Act (USERRA).* Your employment ends due to a layoff. You are applying for disability retirement. You are reverting for reasons other than a layoff to a position that is not eligible for the employer contribution toward insurance coverage. You are a faculty member who is between periods of eligibility. You are a seasonal employee who is between periods of eligibility. You are appealing a dismissal action. *May also continue long-term disability insurance. 6

7 When is continuation coverage available? The PEBB Program will offer continuation coverage to you or your covered family members after you, your surviving dependents, or your employer notifies the PEBB Program that you or your family members are no longer eligible for benefits. Your employer must notify the PEBB Program when: Your (the employee s) employment ends. Your (the employee s) hours of employment are reduced. You (the employee) die. You (the retiree) lose eligibility for PEBB retiree insurance because your employer group ceases participation in PEBB insurance coverage. (School district and educational service district retirees can continue their PEBB retiree coverage, even if their district discontinues participation or never participated with the PEBB Program.) Employees must notify their employer s personnel, payroll, or benefits office, and retirees must notify the PEBB Program when: You divorce or terminate a state-registered domestic partnership. Your child loses eligibility under PEBB rules. You lose eligibility for PEBB retiree insurance because DRS determines that you are no longer disabled and stops your pension. Your surviving dependents must notify the PEBB Program when: You (the retiree) die. You (or your surviving dependent if you die) must notify the PEBB Program in writing no later than 60 days after the date of the qualifying event or the date you or a covered family member loses (or would lose) PEBB health coverage due to a qualifying event, whichever occurs later. Example: If you divorce on June 15, then your former spouse is no longer eligible for PEBB benefits. That is the date of your former spouse s qualifying event. However, your former spouse will not lose PEBB coverage until the end of the month (June 30). You have 60 days after June 30 (the later of the two dates) to notify your personnel, payroll, or benefits office (if you are an employee) or the PEBB Program (if you are a retiree) that your former spouse has lost eligibility. Who can choose continuation coverage? Once PEBB receives notice that a qualifying event has occurred, COBRA or other continuation coverage will be offered to each qualified beneficiary. Each covered member who loses PEBB health coverage can choose COBRA or other continuation coverage. Covered employees, spouses, or domestic partners may elect continuation coverage on behalf of all qualified beneficiaries, and parents may elect continuation coverage on behalf of their children. Any qualified beneficiary for whom continuation coverage is not elected within the 60-day election period specifiec in PEBB s Continuation of Coverage Election Notice will lose his or her right to elect continuation coverage. Children born to or placed for adoption with the covered employee during the COBRA coverage period A child born to, adopted by, or placed for adoption with a covered employee during a period of PEBB continuation coverage is considered to be a qualified beneficiary. The child s continuation coverage begins when the child is enrolled in PEBB coverage, whether through special enrollment or open enrollment, and lasts for as long as continuation coverage lasts for other family members of the employee. To be enrolled in PEBB coverage, the child must satisfy PEBB eligibility requirements (for example, regarding age). Alternate recipients under NMSN or court order A child of the covered employee who is receiving benefits pursuant to a National Medical Support Notice (NMSN) or court order received by the employer or PEBB during the covered employee s period of employment is entitled to the same rights to elect continuation coverage as an eligible dependent child of the covered employee. If the PEBB Program is not notified in writing within these timelines, your family members will lose the right to elect COBRA or other continuation coverage. 7

8 How long does continuation coverage last? COBRA, PEBB Extension of Coverage, and LWOP provide temporary continuation of coverage. The maximum coverage periods are described below. However, flexible spending account (FSA) coverage, if elected, can only last until the end of the year in which the qualifying event occured. Continuation coverage can end before the end of the maximum coverage periods described in this notice for several reasons, which are described in the Continuation of Coverage Election Notice. Qualifying event (or reason that caused you to lose PEBB health coverage) Employee s termination of employment (other than for gross misconduct) or reduction of hours Employee becomes entitled to Medicare within 18 months before termination of employment or reduction of hours Employee on authorized leave without pay Employee s employment ends due to a layoff Employee is receiving time-loss benefits under workers compensation Employee is applying for disability retirement Employee is called to active military duty, as defined by USERRA Employee is on approved educational leave Employee reverts from an eligible position and is not eligible for the employer contribution toward insurance coverage Faculty employee who is between periods of eligibility Seasonal employee who is between periods of eligibility Employee appealing a dismissal action Death*, divorce, termination of a state-registered domestic partnership, or child s loss of eligibility Retiree s employer group terminated participation with the PEBB Program Retiree who is determined to no longer be disabled by the Department of Retirement Systems, so the retiree s pension has stopped Maximum coverage period 18 months Dependents are covered up to 36 months after the date of the employee s Medicare entitlement (employee can continue basic or both basic and optional long-term disability insurance for up to 24 months) (employee can continue basic or both basic and optional long-term disability insurance for up to 24 months) 18 months 12 months (faculty who use 12 months of LWOP may continue medical and dental for six more months under COBRA) 12 months (seasonal employees who use 12 months of LWOP may continue medical and dental for six more months under COBRA) 36 months 18 months (must have enrolled in PEBB retiree coverage after September 15, 1991) 18 months *If the qualifying event is death of the employee or retiree, surviving dependents who qualify under WAC or may be eligible for PEBB retiree coverage. Under PEBB retiree coverage, the spouse or state-registered domestic partner may continue coverage until his or her death, and children may continue coverage until they lose eligibility under WAC

9 When can continuation coverage be extended? You may extend the 18-month maximum period under COBRA, PEBB Extension of Coverage, or LWOP if you or a qualified beneficiary becomes disabled or a second qualifying event occurs after the employee s termination of employment or reduction of hours. You must notify the PEBB Program no later than 60 days after a disability or second qualifying event to extend the continuation coverage period. If you don t, you will lose the right to extend COBRA or other continuation coverage. The period of continuation coverage under FSA cannot be extended under any circumstances. Disability extension of coverage If the Social Security Administration determines that any qualified beneficiary is disabled and you notify the PEBB Program as described below, you and all qualified beneficiaries in your family may be entitled to receive an additional 11 months of continuation coverage, for a maximum of. This extension is available only for qualified beneficiaries who are receiving continuation coverage because of a qualifying event that was the covered employee s termination of employment or reduction of hours. The disability must have started before the 61st day after the covered employee s termination of employment or reduction of hours, and must last at least until the end of the initial continuation coverage period (generally 18 months). To request a disability extension, you must notify the PEBB Program in writing (along with a copy of the Social Security Administration s disability award letter) no later than 60 days after the last of the following events: The date of the Social Security Administration s disability determination. The date of the covered employee s termination of employment or reduction of hours. The date the qualified beneficiary loses, or would lose, PEBB coverage as a result of the employee s termination or reduction of hours. Second qualifying event extension of coverage If your family experiences a second qualifying event, covered family members may extend continuation coverage up to 18 additional months for a maximum of 36 months. These events include: The employee s or retiree s death. Divorce. Termination of a state-registered domestic partnership. The child of an employee or retiree (or their spouse or state-registered domestic partner) loses eligibility under PEBB rules. To qualify, a second qualifying event: Must occur during the 18 months (or in some cases, ) after the employee s termination of employment or reduction of hours, or the retiree s loss of PEBB retiree insurance due to termination of employer group participation with PEBB insurance coverage; and Would have caused the covered family member to lose PEBB coverage if the first qualifying event had not occurred. Note: The second qualifying event extension is not available when an employee becomes entitled to Medicare after his or her termination of employment or reduction of hours. Family members must have been covered under the plan on the day before the first qualifying event. Newborns or adopted children added after the first qualifying event are also eligible for the second qualifying event extension. To request a second qualifying event extension, you must notify the PEBB Program in writing (along with proof of the second qualifying event) no later than 60 days after the last of the following events: The date of the second qualifying event. The date the covered family member would lose PEBB coverage as a result of the second qualifying event, if it had occurred while the qualified beneficiary or family member was still covered under PEBB. 9

10 How do I provide notice if I lose eligibility for PEBB coverage? To apply for PEBB continuation coverage, you must complete the appropriate form(s) found in the PEBB s Continuation of Coverage Election Notice booklet, and submit them via mail or hand delivery within the timelines mentioned. Oral notice (including by telephone) and electronic notice (such as by or fax) are not acceptable. You can find this booklet at or call the PEBB Program at to request one at no charge. Mailing address: Health Care Authority PEBB Program P.O. Box Olympia, WA Street address (for hand deliveries): Health Care Authority PEBB Program 626 8th Avenue SE Olympia, WA If mailed, your notice must be postmarked no later than the last day of the applicable notice period. If hand-delivered, your notice must be received by PEBB no later than the last day of the applicable notice period. Notice periods are described under When is continuation coverage available? (page 7), Disability extension of coverage (page 9), and Second qualifying event extension of coverage (page 9). If your notice is late, or if you do not follow the notice procedures described in this booklet, you and your qualified beneficiaries will lose the right to continue PEBB coverage. Who may provide notice? The covered employee (that is, the employee or former employee who is or was enrolled in PEBB coverage), a qualified beneficiary who lost coverage due to the qualifying event described in the notice, or a representative acting on behalf of either may provide notice. A notice provided by any of these individuals will satisfy any responsibility to provide notice on behalf of all qualified beneficiaries who lost coverage due to the qualifying event described in the notice. Information required for all notices Any notice you provide must include: The name and address of the employee or retiree who is (or was) covered. The names and addresses of all qualified beneficiaries who lost coverage as a result of the qualifying event. The qualifying event and the date it happened. The signature, name, address, and telephone number of the person providing the notice. Additional information required for notice of qualifying event If the qualifying event is a divorce or termination of a domestic partnership, you must include proof of the divorce or termination. If your coverage is reduced or eliminated and later a divorce or termination of the domestic partnership occurs, and you are notifying PEBB that your coverage was reduced or terminated in anticipation of the divorce or termination of the domestic partnership, your notice must include evidence satisfactory to PEBB that your coverage was reduced or terminated in anticipation of the divorce or termination. Additional information required for notice of disability Any notice of disability that you provide must include: The name and address of the disabled qualified beneficiary. The date that the qualified beneficiary became disabled. The names and addresses of all qualified beneficiaries who are still receiving continuation coverage. The date that the Social Security Administration made its determination. A copy of the Social Security Administration s determination. A statement whether the Social Security Administration has subsequently determined that the disabled qualified beneficiary is no longer disabled. Additional information required for notice of second qualifying event Any notice of a second qualifying event that you provide must include: The names and addresses of all qualified beneficiaries who are still receiving continuation coverage. The second qualifying event and the date that it happened. Proof of the second qualifying event. 10

11 When is payment due? To elect continuation coverage, you must pay your premiums no later than 45 days after the date you elect to continue PEBB coverage, or we will not enroll you. Your first premium must cover the cost of continuation coverage from the time your PEBB health coverage ends. If you don t elect coverage and pay premiums in full within these deadlines, you will lose your continuation coverage right unless you regain PEBB eligibility. If you have questions Questions about PEBB eligibility or your continuation coverage rights should be addressed to the PEBB Program by calling For more information about your COBRA rights, the Health Insurance Portability and Accountability Act (HIPAA), and other federal laws affecting group health plans, contact the nearest office of the U.S. Department of Labor s Employee Benefits Security Administration (EBSA) or visit 11

12 P.O. Box Olympia, WA HCA (12/12)