COBRA Insurance is an importance piece of legislation that all employers and HR professionals need to understand. COBRA health insurance allows employees who have quit, terminated, or laid off to continue their medical insurance. Employers have specific responsibilities under the federal COBRA insurance law that the must meet to ensure an employee is notified properly and has the option to elect COBRA coverage.
It is extremely important for companies to follow this regulations and stay in compliance with the COBRA insurance laws, otherwise they can face heavy fines as well as litigation. The U.S. Department of Labor takes COBRA insurance compliance very seriously and will take immediate action if an employee reports that their COBRA insurance was not handled properly.
COBRA Employer Responsibilities
If you are a COBRA employer, the following responsibilities need to be met:
- Employees and their covered spouses need to be notified of their COBRA rights at the start of the employer health plan coverage.
- Employees and all covered spouses/dependents need to be notified within 14 days of their qualification for COBRA insurance coverage. The company must provide all forms to the employee.
- Employers need to keep accurate records that show that the employee has been notified of changes to the policy through the specific windows.
- Employers are responsible for tracking COBRA election periods as well as the length of time that an employee has been enrolled in health insurance coverage.
- Employers need to provide accurate invoices to COBRA for premium payments, as well as short-bill payments. All must be balanced and recorded accurately.
- Employers have to keep all the records/correspondence between the employer and employee.
- Employers have to notify COBRA in the case that there are any changes to the benefits at any time during which the employee is enrolled in the program.
- COBRA continuant must be notified when coverage for the employee has been terminated.
- The continuant has the right to add dependents or change the plan in the way of increasing coverage, so long as the employee maintains an active status.
- Procedures must be maintained in written form in the office of the employer.