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Assisting Individuals Who Leave Your Group

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There are several ways you can help ensure that your group members will have the opportunity to obtain health insurance for which they are eligible elsewhere once they leave your group.  
Immediately notify us to cancel the individual’s coverage by completing a Cancellation Authorization Form. Give the effective date and the reason for the cancellation.
Tell the individual to expect either: a letter from us offering an opportunity to obtain coverage on an individual basis through our Individual products; or to contact us for information about converting from group coverage to non-group coverage.
 
Who is Eligible for Non-Group Conversion Privileges?
Employees of insured groups who become ineligible for coverage under the group policy.
Employees of insured groups who lose group coverage due to termination of the master group policy, unless the employee is insurable under a replacement group policy or heath plan without a waiting period or pre-existing conditions limitation.
Employees of self-funded groups who become ineligible for coverage or who lose group coverage due to termination of the group health plan, if the self-funded plan and the group’s agreement with us provide for conversion privileges.
 
Who Is Not Eligible For Non-Group Conversion Privileges?
Employees who are eligible for coverage under either Medicare or Medicaid. Employees for whom the Individual policy would result in over-insurance under BCBSGa/BCBSHP’s underwriting standards at the time of issue.
Employees who have not applied for the Individual policy and paid the first premium for it within 31 days after termination of their group coverage.
Employees of self-funded groups whose group health plans do not provide for conversion to an Individual policy.
 
Upon notification of the individual’s cancellation from group coverage, we will automatically send a letter explaining how to apply for conversion.  
90-Day Continuation
The 90-day continuation option applies to employees of insured groups with BCBSGa/BCBSHP who:  
Become ineligible for coverage under the group policy; or
Who lose coverage due to termination of the master group policy, unless the employee is insurable under a replacement group policy or health plan without a waiting period or pre-existing conditions limitation.
 
If such an employee loses eligibility for your group's coverage, he or she may be able to continue group coverage for a period of 90 days. The following rules apply:  
The person must have been enrolled under the plan for at least six months
The person must apply for coverage with the group administrator and pre-pay the total premium for the 90-day period prior to his or her termination.
 
COBRA: The Consolidated Omnibus Budget Reconciliation Act of 1985
The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) is a federal law that, if applicable, enables your employees and their covered dependents to keep their group health coverage for 18, 29 or 36 months after becoming ineligible for regular group coverage. The length of time an employee can continue coverage depends on the reason regular coverage ends. The COBRA law does not apply to group health plans maintained by churches, governments or certain small employers (normally those with fewer than 20 employees on a typical business day). However, state and local governments may be subject to similar rules under a different law, the Public Health Services Act.  
It is very important for your group to understand the COBRA rules and how they apply to you. The rules generally apply based on the number of employees, but there are specific rules that determine how employees are counted and during what time period. It is the employer’s responsibility to determine whether it is obligated to provide continuation of benefits under this federal law, and this is not a determination your insurance carrier or self-funded plan administrator can make on your behalf.  
The information in this ERG is very general in nature and it is only intended to describe the basic workings of the COBRA rules. The purpose of including COBRA information in this guide is to assist you in fulfilling the routine administrative requirements of COBRA. It is not intended as legal advice. The COBRA regulations may change from time to time, so it is important for you and your company's legal counsel to review them periodically to ensure compliance.  
Additional information about COBRA can be found on the Web site of the Department of Labor, the federal agency that administers COBRA, at http://www.dol.gov/dol/topic/health-plans/cobra.htm.  
Eligibility for continuation of coverage
COBRA requires certain employers to provide continuation rights to individuals covered under their group health plans. Employers subject to COBRA must offer continuation to each person who is a "qualified beneficiary" at the time a "qualifying event" occurs. A qualifying event is a particular type of event that results in a loss of regular group coverage of a qualified beneficiary. A qualified beneficiary is anyone who was a covered employee, spouse or dependent child on the day before the qualifying event and who loses regular group coverage due to the qualifying event. In addition, if a child is born to or placed for adoption with the covered employee during the employee's period of COBRA continuation coverage, that child automatically becomes a qualified beneficiary as well.  
The benefits under the continuation of coverage must be the same as those provided to “similarly situated non-COBRA beneficiaries.” The COBRA regulations provide that coverage should match that of covered persons “most similarly situated” to the qualified beneficiary just before the qualifying event. In most cases, this will be coverage that is identical to the plan benefits in effect before the qualifying event. Each enrolled family member may determine independently whether to continue coverage.  
At each annual open enrollment period, COBRA members should be given the same coverage choices as other plan participants. Dependents who are qualified beneficiaries may choose the type of coverage they want regardless of what the former employee selects. New dependents may be added to coverage or canceled in the same manner as with other health care programs (although added dependents other than children born to or placed for adoption with the covered employee during the continuation period do not gain COBRA rights of their own to make separate, independent choices of coverage).  
The maximum length of time a qualified beneficiary can continue coverage depends on the reason regular coverage ends and, in some cases, whether or not the qualified beneficiary is disabled or has a disabled family member. The chart below outlines the qualifying events, qualified beneficiaries, and length of time for continuation of coverage.  

Qualifying Event Qualified Beneficiaries Maximum Coverage Duration
Reduction in covered member’s hours of employment 
Covered member, spouse and/or dependent children 
18 months* 
Termination of covered member’s employment 
Covered member, spouse and/or dependent children 
18 months* 
Divorce or legal separation 
Spouse and/or dependent children who lose eligibility for regular group coverage due to the divorce or legal separation 
36 months 
Death of a covered member 
Spouse and/or dependent children 
36 months 
Termination of dependent child’s eligibility (e.g., due to attainment of the limiting age or child’s marriage) 
Child 
36 months 
Covered member’s entitlement to Medicare 
Spouse and/or dependent children 
36 months 
 
*29-Month Continuation Period Due to Disability
The 18-month continuation of coverage may be extended to 29 months in certain situations. An 11 month extension beyond the usual 18-month continuation period is available to each covered member of a disabled qualified beneficiary’s family when:  
An employee or a covered dependent is found by the Social Security Administration to have been totally disabled at any time during the first 60 days of COBRA coverage, and
The disabled person notifies the plan of the disability determination within 60 days after receiving it and before the end of the original 18-month continuation period.
 
Rights of family members
Each enrolled family member may determine whether to continue coverage. For example, the covered spouse of a terminated employee may elect COBRA coverage even if the employee does not.  
Initially, when dependents transfer from regular group coverage to COBRA, the benefits they receive under the continuation of coverage must be identical to the plan benefits in effect for other "similarly situated" non-COBRA plan participants. This is usually coverage identical to what the dependent had on the day before the qualifying event. Subsequently, when you hold your annual renewal period, COBRA qualified beneficiaries should be given the same coverage choices as other plan participants. In addition, dependents that are qualified beneficiaries may choose the type of coverage they want regardless of what the former employee selects. New dependents may be added to coverage or cancelled by COBRA participants in the same manner as other plan participants may add or cancel dependent coverage.  
Note: Although a COBRA participant at open enrollment may add eligible dependents to the coverage, these newly added dependents do not gain COBRA rights of their own. For example, they do not gain the right to make a separate, independent choice of coverage at future open enrollment periods. Only those dependents that were eligible for COBRA (already covered) at the time of the qualifying event ordinarily have these rights. An exception is required for newborn children who are born during the participant's COBRA continuation period and children placed with the COBRA participant for adoption during his or her continuation period. These newly added dependents do acquire their own COBRA rights even though they were not covered under the plan at the time of the original qualifying event.  
Cost of coverage
The qualified beneficiary may be charged a maximum of 102% of the “applicable premium” for the COBRA coverage.
COBRA participants in the category of coverage that includes a disabled qualified beneficiary can be charged up to 150% of the applicable premium for months 19-29 of continuation.
The applicable premium is the total cost of coverage for a similarly situated member in the plan that is not a COBRA participant.
 
Time limits for notification of and enrollment in COBRA coverage
You must ensure that all covered qualified beneficiaries receive written notice of their right to continuation of coverage. Administrators who do not comply with notification requirements may be subject to fines or penalties under federal law and may be required to pay the medical expenses that COBRA would have paid.  
A qualified beneficiary must notify the Plan Administrator (usually the employer) within 60 days after:  
The employee’s divorce or legal separation; or
A covered child’s loss of eligibility due to attainment of the limiting age or marriage.
 
If you administer the COBRA benefits, the following list indicates the COBRA events and notification time periods:  
Within 14 days of qualifying event, employer must notify qualified beneficiaries of their option to continue coverage through COBRA.
A qualified beneficiary is entitled to elect continuation coverage during an election period of at least 60 days’ duration. The election period begins no later than the date regular group coverage ends due to the qualifying event. It ends 60 days after notice is received from the plan administrator, or the date coverage ends, if later.
Within 45 days after electing COBRA coverage, the qualified beneficiaries must make the first premium payment.
Within 30 days after the due date of each premium throughout the continuation period, the qualified beneficiaries must pay bill.
 
If you have appointed BCBSGa’s COBRA Solutions or a different Plan Administrator outside of your organization to administer COBRA benefits, the following list indicates the COBRA events and notification time periods:  
A qualified beneficiary must notify the Plan Administrator within 60 days after: the employee’s divorce or legal separation; or a covered child’s loss of eligibility due to attainment of the limiting age or marriage.
Within 30 days after the occurrence of any other type of qualifying event, the employer must notify the plan administrator of qualifying event.
Within 14 days after notification of a qualifying event by either the employer or a qualified beneficiary, the Plan Administrator must notify each qualified beneficiary of option to continue coverage through COBRA.
A qualified beneficiary is entitled to elect continuation coverage during an election period of at least 60 days’ duration. The election period begins no later than the date regular group coverage ends due to the qualifying event. It ends 60 days after notice is received from the plan administrator, or the date coverage ends, if later.
Within 45 days after electing COBRA coverage, the qualified beneficiaries must make the first premium payment.
Within 30 days after the due date of each premium throughout the continuation period, the qualified beneficiaries must pay bill.
 
Enrolling individuals in COBRA
COBRA coverage is effective from the first day that regular group coverage ends due to the qualifying event. Often this effective date is retroactive since an individual can take up to 60 days to elect coverage. However, the individual is responsible for paying the health care premium from the first day of COBRA coverage even if the individual takes the full 60 days to accept coverage.  
Employees who lose group eligibility should be removed from your group plan as soon as they become ineligible. Removing employees who are no longer eligible from the group plan does not affect their COBRA eligibility.  
To enroll an individual in COBRA coverage:  
Complete an application form in its entirety
Make sure that COBRA coverage is requested (either check COBRA box or write COBRA on the application form)
Send the COBRA application and premium to us
 
When COBRA coverage ends
A qualified beneficiary’s COBRA continuation ends on the earliest date that any of the following events occur:  
The 18-month, 29-month or 36-month period ends.
The employer (including all trades or business under common control) ceases to provide any group health plan to any employee.
The qualified beneficiary becomes covered under another group health plan that does not contain any exclusion or limitation for any pre-existing conditions of the qualified beneficiary.
The qualified beneficiary, after the date of COBRA election, becomes entitled to Medicare benefits.
For people whose continuation period has been extended due to total disability, the first day of the month beginning at least 30 days after the Social Security Administration determines that the person is no longer disabled.
The due date of a month for which a timely payment has not been made.
 
When COBRA continuation ends, use normal cancellation procedures to remove the person from your group. We will automatically offer the individual the opportunity to enroll in a Personal Health Care plan (Anthem KeyCare and Anthem BlueCare) or provide information on conversion from group coverage to non-group coverage (Anthem HealthKeepers).  
Conversion to Individual Coverage
Employees or dependents no longer eligible for group coverage or COBRA continuation of coverage may:  
Convert to a BCBSGa Individual health plan without having to furnish evidence of insurability, for insured plans and self-funded plans which provide for conversion, or
Apply for a BCBSGa product subject to health underwriting (evidence of insurability).
 
Eligible individuals
An "eligible individual" may purchase a BCBSGa Individual health plan with no health underwriting or pre-existing conditions limitation. To be an "eligible individual," the person must meet the following criteria:  
Individuals must have at least 18 months of total creditable coverage without a significant break in coverage (a break in coverage longer than 90 consecutive days). Creditable coverage may include enrollment in fully insured and self-insured group health plans, Individual health plans and short-term plans, Medicaid, Medicare and other public health plans. However, the individual’s most recent coverage must have been individual insurance coverage, a group health plan, governmental plan, or health insurance coverage offered in connection with any such plan.
The individual must be ineligible for group health coverage, Medicare Parts A or B, or Medicaid, and be without any other health insurance coverage.
If eligible for continuation of coverage under COBRA or a similar state program, the individual must have elected and exhausted this coverage.
The individual must not have been terminated from his or her most recent coverage for nonpayment of premiums or fraud.
 
 
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Blue Cross and Blue Shield of Georgia, Inc. and Blue Cross Blue Shield Healthcare Plan of Georgia, Inc. are independent licensees of the Blue Cross and Blue Shield Association. The Blue Cross and Blue Shield names and symbols are registered marks of the Blue Cross and Blue Shield Association.