DAY-3

COBRA
1)Key provisions:

Qualified Beneficiaries must be allowed to continue the group coverage that he/she had the
day prior to a qualifying event for a specific length of time if they lose coverage in the plan
due to that event.

Qualified Beneficiaries include covered employees/retirees as well as their spouse and

Children.

Non-Qualified Beneficiaries include newly added dependents during a subsequent enrollment

period.

COBRA coverage is mainly offered for Medical, Dental, Vision, and HCFSA plans and
generally excludes Life and Disability Insurance plans.

Employers charge up to 102% of the applicable cost for elected COBRA coverage and up to
150% of the applicable cost for any extension period due to a disability.

2) Qualifying/Triggering Events for Employees and Dependents

Qualifying events are events that make qualified beneficiaries eligible for COBRA. A qualifying
event requires two elements:
One of the triggering events must occur
Coverage must be lost due to the triggering event.

The following events are triggering events for employees and will be considered COBRA
qualifying events if they are accompanied by a loss of plan coverage:
Voluntary or involuntary termination (excluding gross misconduct)
Reduction in hours or retirement resulting in loss of coverage
Leaves of absence, layoffs, and strikes resulting in loss of coverage
Employers Chapter 11 bankruptcy resulting in loss of retiree coverage or substantial
reduction in retiree coverage (i.e., bankruptcy is a triggering event with regard to retiree
plans only)

The following events are triggering events for dependents and will be considered COBRA
qualifying events only if they are accompanied by a loss of plan coverage:
The death of the covered employee/retiree
The divorce or legal separation of the covered spouse from the employee
A dependent child losing dependent status under the terms of the plan (e.g., aging out)
A covered employees/retirees entitlement to Medicare.
3)

4) Termination of COBRA
COBRA coverage can be terminated prior to the maximum coverage period (18, 29, or 36
months) if the qualified beneficiary:

Fails to pay the premium on time

Drops coverage
Enrolls in Medicare
Obtains other group coverage

COBRA coverage is also terminated if the employer ceases to provide any group health coverage

5) Key Concepts
The Benefits Operations Administrator is a member of a Client Delivery Group or CDG.
The Benefits Operations Administrator works closely with the Benefits Operations Manager, the
subject matter expert in the CDG team
The Benefits Operations Administrator is responsible for getting timely and accurate information to
participants and is involved in processing and processing improvements.
All Benefits Operations Administrators work with requirements documents, processing calendars, and
standard operating procedure documents.
There are many tools and resources available to BOAs, including Maestro, Workbench and its
components, GUI, TBA, YBR, and others. BOAs use PCSs and have the support of a team to assist
them in necessary changes to PCSs.
Among the many database Operations uses, these are important:
HRO Ref Admin Best Practices
HRO Ref Health & Welfare

6) Key Concepts
Section 125 mandates how employers can offer benefits to their employees.
 Health and Welfare plans are designed to protect employees from the costs of catastrophic illness
and to encourage preventive care.
Health and Welfare plans include many options and choices to create a plan that is specific to an
employees needs.

7) Key Concepts
The most common types of Medical Plan options an employer can offer an employee include:
Indemnity, HMO, PPO, POS, EPO and Consumer Driven Plans. Click here for a summary of Medical
Plan types.
The Government has designed Flexible Benefit Plan Rules and the HIPAA Privacy to regulate how
Medical Plans are administered.

8) Key Concepts
The two main eligible Health and Welfare plan populations are active populations and inactive
populations.
Health and Welfare plan population groups include eligible employees and their dependents.
Health and Welfare provisions are set by employers; these provisions are based on cost, state and
federal law, and insurance carrier requirements.

9) Key Concepts
The most common types of Dental Plan options offered by employers are Indemnity, DMO and PPO.
The Government has designed Flexible Benefit Plan Rules and the HIPAA Privacy Act to regulate
how Dental Plans are administered.

10) Key Concepts

The most common types of Dental Plan options offered by employers are Indemnity, DMO and PPO.
The Government has designed Flexible Benefit Plan Rules and the HIPAA Privacy Act to regulate
how Dental Plans are administered.

11) Key Concepts

The person request, provision, and person results tables interact with each other in order to capture
and process enrollment data on the TBA System.
Plan provisions are the foundation on which all Health and Welfare processing takes place.
An option plan supports the Person Enrollment Activity. The Person Enrollment Activity is a specific
kind of activity used to collect and load a participants Health and Welfare elections.
Other kinds of activities are used for other kinds of benefits, such as Defined Contribution and
Defined Benefit plan benefits.
Every transaction that is processed on the TBA System has rules, or provisions, that are associated
with it that provide specific instructions for how the transaction should work. An event will run for a
participant and use those provisions, and the result is a set of transactions (i.e., person request data)
that will be used to collect participant elections.
When all of the option plan components, availability rules, price tags, and coverage calculations are
set up correctly according to the plan provisions, the calc data presents all of the available participant
choices. Once a participant makes an election, the data assignment rules assign any fields on the
Person Option Plan Transaction that the participant is not expected to choose.
12) Key Concepts
Eligibility determines who can take advantage of Health and Welfare plan benefits offered through the
employer.
Participants are eligible for coverage in certain plans according to the criteria they meet.
Eligibility criteria may be based on status, location, classification, or group division.
Employers establish different eligibility rules for their active, rehired, retired, and disabled employee
populations.

13) Key Concepts

Dependent eligibility determines who, other than the employee, can take advantage of health &
welfare plans offered through the employer.
The Internal Revenue Service defines a dependent as someone who receives over half of their
financial support from a covered employee. Employers can choose to be more generous. Some
employers simply define a dependent as an individual, other than the employee, covered under the
health & welfare plan.
Eligible dependents fall into one of four types: spouses, children, parents, or siblings. The employer
does not have to define all of these types as eligible dependent for their health & welfare plan.
A spouse is the person an employee is legally married to under the laws of the state in which they
live, including common-law spouses. Many plans also allow for domestic partners (same-sex or
opposite sex) to be covered as spouses.
Children must meet the eligibility rules defined by the employer, insurance carrier, and state in order
to be eligible for coverage as a dependent in a health & welfare plan, although state requirements
only apply for fully insured plans.

14) Key Concepts

Flex credits are credits or dollars that employees use to purchase certain benefits.
The types of flex credits commonly offered by employers are service credits, wellness credits, health
care credits, subsidized pricing, and excess credits.
The states of New Jersey and Pennsylvania, as well as some municipalities, do not recognize Section
125. Employees are taxed on their "opportunity" to take flexible credits as cash, regardless of
employees' actual benefit elections

15) Key Concepts

The most common types of Prescription Drug Plans an employer can offer an employee include retail,
mail order, and integrated Prescription Drug Plans.
The government has designed flexible benefit plan rules and the HIPAA Privacy Act to regulate how
Medical Plans are administered.

16) Key Concepts

MH/SA Programs help participants deal with issues such as depression, stress, and substance
abuse.
MH/SA Programs provide medical treatment of a condition.
The government has designed Flexible Benefit Plan Rules and the HIPAA Privacy Act to regulate
how Medical Plans are administered.
The Mental Health Parity Act requires all insured and self-insured employer-based health benefit
plans to offer the same dollar annual and lifetime limits for covered mental health benefits as those
that apply to medical and surgical benefits.

17) Key Concepts

EAPs offer participants confidential counseling and referral services for personal and work life issues.
Although EAPs are usually available to all participants regardless of whether they are enrolled in a
Medical Plan, some employers carve out EAPs and only offer them to participants who enroll in a
Medical Plan.
EAPs often integrate with MH/SA Programs. The EAP acts as the gatekeeper offering confidential
counseling to determine whether the participant needs to be referred for medical treatment.
Counseling of the participant is covered by the EAP. Medical treatment is eligible for coverage under
the participants MH/SA Program.
The EAP process begins with a confidential call to a counselor who will assess the situation and
recommend a module of care.
The HIPAA Privacy Act prohibits unauthorized users from accessing a participants clinical or
personal health information.

18) Key Concepts

Various situations require a LOA, such as:

Illness or injury
Birth or adoption of a baby
Family member has a serious health condition
Military training or call to active military duty
Continue or complete education
Sabbatical from work
Deal with personal issue
Different situations require different types of leaves, along with different eligibility requirements and
coverage requirements.
The five types of LOAs include:
Family and Medical Leave Act (FMLA)
Short-Term Disability (STD)
Long-Term Disability (LTD)
Personal
Military

19) Key Concepts

Employers provide a base level Life and Accident Insurance at no cost to the employee.
Employees can elect supplemental Life and Accident Insurance at an additional cost.
Employees can elect Accidental Death and Dismemberment Insurance as added protection.

20) Key Concepts

Disability insurance provides financial protection against interrupted income for employees who are
unable to work due to pregnancy, illness, or injury that is not work-related.
Short-term disability (STD) plans allow time off for a limited period of time when an employee is sick
or injured due to a non-work-related illness, injury, or pregnancy.
STD provides income protection for a limited period of time.
 Long-term disability (LTD) plans provide income protection to employees for both occupational and
non-occupational disabilities.
LTD does not apply until short-term disability benefits are exhausted.
Long-term disability benefits are taxable.

21) Key Concepts

Flexible Spending Accounts are a benefit available in some Health and Welfare plans that allow
participants the opportunity to put money aside on a pretax basis to pay for health care or dependent
care expenses.
Participants have the option to put money into a Health Care Spending Account on a pretax basis to
help pay for eligible expenses that are not covered by their medical, prescription drug, dental, or
vision plans.
Participants have the option to put money into a Dependent Care Spending Account on a pretax
basis to help pay for eligible, work related dependent care expenses.
A participants contributions to flexible spending accounts are deducted from their paycheck each pay
period. A participant has three options when making a contribution to a spending account: employee
contributions, employer provided credits, and employer contributions.
The Internal Revenue Service (IRS) outlines the Use It or Lose It Rule that requires participants to
forfeit any money remaining in a spending account at the end of the plan year. However, some clients
allow employees to incur claims through March 15 of the subsequent plan year and submit claims for
reimbursement through April 30. A health reimbursement account (HRA) is a separate account solely
funded by the employer to pay for things like out of pocket medical expenses and individual health
insurance premiums. This account is often offered as a supplement to medical plans with high
deductibles, but this is not a requirement.
A health savings account (HSA) is a trust or custodial account established exclusively to receive
contributions for eligible individuals enrolled in high-deductible health plans (HDHP). Employee
contributions to an HSA are tax deductible. Employer contributions on behalf of an employee are not
subject to federal income tax or FICA. Distributions from an HSA are tax free as long as they are
used to pay for qualified medical expenses for the participant and eligible dependents.

22) Key Concepts

A qualified beneficiary is an individual who, on the day before the qualifying event, is covered under
the employers group health plan. To be a qualified beneficiary, the individual must also be:
The covered employee or covered retiree;
The covered spouse of a covered employee or covered retiree;
The covered dependent child of a covered employee or covered retiree;
A newborn child added to a former employees COBRA coverage within 30 days of birth
An adopted child added to the former employees COBRA coverage within 30 days of placement
for adoption.
A newborn child added to a former dependents (e.g., an ex-spouse) COBRA coverage would not be
considered a qualified beneficiary but rather a nonqualified beneficiary.
Self-employed people, agents, independent contractors, directors, and leased employees are
qualified beneficiaries if they are covered under an employer-sponsored group health plan.
A nonqualified beneficiary is eligible to be a dependent on COBRA coverage if he or she is added
after the qualifying eventduring annual enrollment or because of a qualified change in status.

23) PCS Requirements Documents

 Personalized Communication Statements (PCSs) are the form letters that are sent out to participants.
The requirements document specifies what text appears in a PCS and when the text appears.
Enabler does not generate PCS requirements documents. There are SDLC templates that the
Implementation Requirements Analyst uses.
Base PCS Requirements documents are lengthy with a table of contents to help you find particular
Chapters or PCSs. Below is an illustration from a requirements document for only one PCS called
Confirmation of Address Change. It shows you the text of the letter and the conditions when certain
passages will appear.

24)
Other Requirements Documents
->YBR
This requirements document describes what the text of the client's Your Benefits Resources (YBR)
website will contain.
Refer to this document when you have questions about:
The variables that are inserted into standard YBR text
The contingencies for inserting the variables

->File Layouts
This requirements document describes requirements for the data files sent between the client, third
parties, and Aon Hewitt.
The sample document is a template for payroll data, Refer to this document when you have questions
about:
The content and the technical layout of data in a file such as the payroll data feed

->High Level Summary

This document introduces you to the client's requirements. Not all teams will have summaries, but if your
team does, start with this document when learning about the client's requirements