Cancelling Health Benefits
janieb
11 Posts
Once again I am letting you know that I am new to the role of HR Mgr. I guess I just want to make certain that I am doing this correctly.
When an employee is terminated or leaves the company, you send out the cobra papework, etc.
Okay, how long do you continue their health insurance after they are terminated? Do you cancel before they make the decision to elect the Cobra or cancel at the end of the month in which their employment ended. The previous HR Admin. supposedly would cancel their coverage at the end of the month and then I was told you have to give them 30 days coverage from the day they are terminated/quit. Please let me know....
There are some great people on this forum. I love it!!! You have all been a big help to me!!!
When an employee is terminated or leaves the company, you send out the cobra papework, etc.
Okay, how long do you continue their health insurance after they are terminated? Do you cancel before they make the decision to elect the Cobra or cancel at the end of the month in which their employment ended. The previous HR Admin. supposedly would cancel their coverage at the end of the month and then I was told you have to give them 30 days coverage from the day they are terminated/quit. Please let me know....
There are some great people on this forum. I love it!!! You have all been a big help to me!!!
Comments
Why anybody chooses COBRA is beyond me.
>For us, we carry the termed employee's insurance
>to the end of the month. The COBRA start date
>would be the 1st of the following month, should
>they so choose.
>
>Why anybody chooses COBRA is beyond me.
I agree! We recently downsized, layed off 3rd shift and only one person elected the cobra.
Thanks for your answer and have a great evening!
It should assist you with this question and those in the future.
To determine when to cancel this person's health insurance, refer to your health insurance contract or call them. Ours doesn't terminate coverage until the end of the month. Some will terminate on the date of termination. The ex-employee has around 30 days to decide if they want COBRA and then another 45 days to make payment back to the original date. If they opt for COBRA coverage, then we add them back on to our group insurance. Again, check with your health insurance company.
>[url]http://www.dol.gov/ebsa/faqs/faq_consumer_cobra.html[/url]
>It should assist you with this question and
>those in the future.
>To determine when to cancel this person's health
>insurance, refer to your health insurance
>contract or call them. Ours doesn't terminate
>coverage until the end of the month. Some will
>terminate on the date of termination. The
>ex-employee has around 30 days to decide if they
>want COBRA and then another 45 days to make
>payment back to the original date. If they opt
>for COBRA coverage, then we add them back on to
>our group insurance. Again, check with your
>health insurance company.
One thing that stuck out for me in your post though - (I'm guessing it's a typo) - this is pasted in from that site:
The individual then has 60 days (me - not 30) to decide whether to elect COBRA continuation coverage. The person has 45 days after electing coverage to pay the initial premium.
Our policy says we cover them to the end of the month, so we do - even though it means eating the part of the premium that they would normally pay. With my insurance co, I just send the paperwork in when I know about the termination (with the appropriate date indicated) and then if they elect COBRA, I send that in as soon as I get it.
And as for who would do it, I had an employee termed for 3 day NCNS, and then he went into rehab right away. It was definitely cheaper for him to pay the COBRA for a month or two.
Next, I would find out exactly what your insurance company does and what you are responsible for. (ie. We have to send out initial COBRA letters, but we pay our insurance company to handle COBRA.) They may already be doing this and you don't have to. If they aren't doing it, you might want to find out what it would cost if they would. Also, depends on how large your company is as to whether you even have to offer COBRA. COBRA is a very detailed thing to manage and you should "outsource" this until you have a better grasp on things. Who is sending it out when divorced and/or child no longer eligible? (If employee doesn't notify you in a certain amount of time of dependents who are no longer eligible, you don't even have to offer COBRA.)
Next, you should find out from your plan document when your insurance ends for the employee at termination. (Ours it is the last day they work, some it is the 15th and 30th and some the last day of the month.) How often do you deduct for insurance (once a month, every pay, twice a month)? if it is through the end of the month, do you take out enough premium deductions? Also, who are you supposed to notify with the insurance when the employee terminates.
I would spend a little time on this to get straight at the beginning. It will save you time in the long run.
Good luck. It sounds as if you are eager to learn and that is a very good thing. Don't hesitate to ask questions, whether or not it is on the Forum or your broker or an attorney. This is the best way to learn from others mistakes.
E Wart