The J. Paul Getty Trust Health & Welfare Plan. Consolidated Omnibus Budget Reconciliation Act General Notice of COBRA Continuation Coverage Rights

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1 The J. Paul Getty Trust Health & Welfare Plan Consolidated Omnibus Budget Reconciliation Act General Notice of COBRA Continuation Coverage Rights You are receiving this notice because you, and/or your dependent(s), have recently become covered under one of the J. Paul Getty Trust medical plans. This notice contains important information about your right to COBRA continuation coverage, which is a temporary extension of coverage under the Plan. The right to COBRA continuation coverage was created by a federal law, the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). COBRA continuation coverage can become available to you and to other members of your family who are covered under the Plan when you would otherwise lose your group health coverage. This notice generally explains COBRA continuation coverage, when it may become available to you and your covered dependents, and what you need to do to protect the right to receive it. This notice gives only a summary of your COBRA continuation coverage rights. For more information about your rights and obligations under the Plan and under federal law, you should either review the Plan s Summary Plan Description (SPD) and the Summary of Material Modifications (SMM) available on Getty GO or by contacting the Plan Administrator: The J. Paul Getty Trust Attn: Assistant Director, Human Resources 1200 Getty Center Drive, #400 Los Angeles, CA Benefits@getty.edu COBRA QUALIFYING EVENTS COBRA continuation coverage is a continuation of Plan coverage when coverage would otherwise end because of a life event known as a qualifying event. COBRA continuation coverage must be offered to each person who is a qualified beneficiary. A qualified beneficiary is someone who will lose coverage under the Plan because of a qualifying event. Depending on the type of qualifying event, employees, spouse/domestic partners of employees, and dependent children may be qualified beneficiaries. If you are an employee, you will become a qualified beneficiary if you will lose your coverage under the Plan because either one of the following qualifying events happens: 1. Your hours of employment are reduced, or 2. Your employment ends for any reason other than your gross misconduct. If you are the spouse/domestic partner of an employee, you will become a qualified beneficiary if you will lose your coverage under the Plan because any of the following qualifying events happens: 1. Your spouse/domestic partner dies; 2. Your spouse/domestic partner s hours of employment are reduced;

2 3. Your spouse/domestic partner s employment ends for any reason other than his or her gross misconduct; 4. Your spouse/domestic partner becomes enrolled in Medicare (Part A, Part B, or both); or 5. You become divorced/legally separated from your spouse or your domestic partnership ends. Your dependent children will become qualified beneficiaries if they will lose coverage under the Plan because any of the following qualifying events happens: 1. The parent-employee dies; 2. The parent-employee s hours of employment are reduced; 3. The parent-employee s employment ends for any reason other than his or her gross misconduct; 4. The parent-employee becomes enrolled in Medicare (Part A, Part B, or both); 5. The parents become divorced or legally separated or the domestic partnership ends; or 6. The child stops being eligible for coverage under the plan as a dependent child. The Plan will offer COBRA continuation coverage to qualified beneficiaries when coverage is ending due to 1) end of employment or reduction of hours; 2) death of the employee; or 3) enrollment of the employee in Medicare. The Plan will provide you with an election notice within 30 days from the date coverage otherwise would have ended due to the qualifying event. For qualifying events other than those previously mentioned, you are required to notify the Getty within 60 days from the date coverage otherwise would have ended due to the qualifying event. See How To Obtain COBRA Coverage, on page 4 of the notice, for information on how to elect coverage. COBRA COVERAGE PERIOD Once the Getty receives notice that a qualifying event has occurred, COBRA continuation coverage will be offered to each of the qualified beneficiaries. For each qualified beneficiary who elects COBRA continuation coverage, COBRA continuation coverage will begin first day of the month after coverage would otherwise have been terminated. COBRA continuation coverage is a temporary continuation of coverage. When the qualifying event is the death of the employee, enrollment of the employee in Medicare (Part A, Part B, or both), your divorce or legal separation, your domestic partnership ends or a dependent child losing eligibility as a dependent child, COBRA continuation coverage lasts for up to 36 months. When the qualifying event is the end of employment or reduction of the employee s hours of employment, COBRA continuation coverage lasts for up to 18 months. There are two ways in which this 18-month period of COBRA continuation coverage can be extended. SECOND QUALIFYING EVENT If you or one of your covered dependents experience another qualifying event while receiving COBRA continuation coverage, the spouse/domestic partner and dependent children in your family can get additional months of COBRA continuation coverage, up to a maximum of 36 months. This extension is available to the spouse/domestic partner and dependent children if the former employee dies, enrolls in Medicare (Part A, Part COBRA General Notice Page 2 April 2008

3 B, or both), gets divorced or legally separated, or the domestic partnership ends. The extension is also available to a dependent child when that child stops being eligible under the Plan as a dependent child. In all of these cases, you must make sure that the Getty is notified of the second qualifying event within 60 days of the second qualifying event. See How To Obtain COBRA Coverage, on page 4 of the notice, for information on how to elect coverage. COST FOR COBRA COVERAGE You will be charged the full cost of coverage under the group plan(s) in which you are enrolled, plus an administration charge that is 2% of the group cost. The J. Paul Getty Trust will no longer pay any amount toward your health care coverage. Following your 60-day election period, you will then have 45 days from the date you enroll to pay for your continued coverage. The first payment will include the cost of coverage beginning with the first day your coverage would have otherwise ended. After the initial payment, you must pay the required premium by the first day of each month and coverage will be cancelled if your payment is not received within the 30-day grace period following each payment due date. You will be responsible for paying premiums directly to the J. Paul Getty Trust for continuation coverage. EXTENSION OF COVERAGE FOR DISABLED PERSONS If you or a dependent is determined by the Social Security Administration to have been disabled on the date of termination or reduction in hours, or within the first 60 days of continuation coverage due to such event, you may extend continuation coverage for up to 29 months, instead of 18 months. Your non-disabled dependents on continuation coverage may also elect this extension. To qualify for this extra 11 months of coverage, you must notify the J. Paul Getty Trust within 60 days of the date Social Security made the disability determination and before the end of the initial 18-month period. If Social Security makes a determination of disability prior to the date your employment ends or your hours are reduced, then you must notify the J. Paul Getty Trust within 60 days of the date your employment ends or hours are reduced. You also must notify the J. Paul Getty Trust within 30 days if the Social Security disability determination expires. The cost of coverage during the 19 th through the 29 th month extension period will be 150% of the monthly group cost. CALIFORNIA EXTENSION OF COBRA ELIGIBILITY PERIOD (HMO ONLY) A California law, Assembly Bill 1401, requires that an extension of the COBRA eligibility period to 36 months from the original event date be provided to individuals who exhaust their federal COBRA eligibility period, normally 18 months or, in the case of an individual certified by the Social Security Administration as disabled, 29 months. This extension applies to group health plans in which benefits are provided by insurance carrier and HMO s. To be eligible for this extension, your federal COBRA coverage must have started on or after January 1, Premiums An eligible beneficiary electing extended continuation coverage for the HMO will be required to pay, on or before the due date, on a monthly basis, 110% of the applicable rate charged to a similarly situated individual who is an active employee covered by the group plan. In the case of a qualified beneficiary who is determined to be disabled pursuant to Title II or Title XVI of the United States Social Security Act, an amount not greater than 150% of the group rate for a similarly situated active employee covered by the group plan. COBRA General Notice Page 3 April 2008

4 Extended Eligibility Period You are eligible for the extended coverage until: 1. You fail to pay the required monthly premiums on a timely basis; 2. You become covered by another group health plan, even if the coverage provided is less favorable than your COBRA coverage; 3. You become entitled to Medicare; 4. Your former employer ceases to maintain any group health plan(s); 5. The date 36 months after the date your group benefits would have terminated as the result of your original qualifying event; 6. If your extended coverage is the result of disability, the later of the date that is 36 months after the date your coverage would have terminated because of your original qualifying event or the month that begins more than 31 days after the date of the final determination under Title II or Title XVI of the United States Social Security Act that the qualified beneficiary is no longer disabled. You are required to notify the Getty within 30 days of the date that you are no longer disabled. HOW TO OBTAIN COBRA COVERAGE The Plan will automatically offer COBRA continuation coverage to qualified beneficiaries when coverage is ending due to: 1. end of employment or reduction of hours; 2. death of the employee; or 3. enrollment of the employee in Medicare. The Plan will provide you with an election notice within 30 days from the date coverage otherwise would have ended due to the qualifying event. For qualifying events such as divorce/legal separation or a child becoming ineligible due to age, marital status or student status, you are required to notify the Getty within 60 days from the date coverage otherwise would have ended due to the qualifying event. To notify the Getty of a qualifying event, complete the Employee Notification of Qualifying Event form available on GO, through your Human Resources Coordinator, or by contacting the Getty: The J. Paul Getty Trust Attn: Benefits, Human Resources 1200 Getty Center Drive, #400 Los Angeles, CA Benefits@getty.edu In any event, you or your dependents will have 60 days from the later of the date you receive the election form or the date coverage will end to inform the J. Paul Getty Trust that you want COBRA coverage. You do not have to show that you are insurable to choose COBRA coverage. COBRA rights will be forfeited if you or your eligible dependents do not file the COBRA elections forms within this 60-day period. If you do not choose continuation coverage, your group health insurance coverage will end. However, your spouse/domestic partner and/or your eligible dependents may elect continuation coverage, independent of your rejection. COBRA General Notice Page 4 April 2008

5 Your initial continuation coverage provided must be identical to coverage provided to similarly situated employees under the plan on the day prior to the qualifying event, although it may be modified if coverage changes for active employees or family members. CONVERSION PRIVILEGE AFTER COBRA TERMINATES (HMO only) You and your enrolled dependents are entitled to a conversion policy upon the expiration of COBRA continuation coverage if you are enrolled an HMO. In the event you do not elect COBRA coverage, you may still apply for conversion to an individual medical policy. To apply of conversion coverage, contact the carrier of the HMO by calling the toll-free telephone number on your ID card. If you wish to convert your medical coverage to an individual policy, you must make your application within 30 days from the date your coverage terminates to ensure continuous coverage. If you elect COBRA coverage, you will have the option to convert your medical coverage to an individual policy during the last 180 days of the maximum 18-, 29-, or 36-month COBRA notification period. Please note: The conversion policy will not have the same coverage as your group/continuation coverage (or continuation coverage). You will want to thoroughly understand the differences between the group/continuation coverage before making a decision. QUESTIONS If you have any questions about your continuation coverage options, call the Benefits PhoneLine at or send an to BENEFITS@getty.edu. You may also contact the nearest Regional or District Office of the U.S. Department of Labor s Employee Benefits Security Administration (EBSA). Addresses and phone numbers of Regional and District EBSA Offices are available through EBSA s web site at Keep the Getty informed of address changes. In order to protect your rights, you should keep the Getty informed of any address changes. COBRA General Notice Page 5 April 2008