COBRA Continuation Coverage

Continuation coverage is coverage you and your covered dependents have the right to elect after you lose group health coverage. Federal (COBRA) and state laws grant you and your covered dependents the right to purchase the same coverage you had before the qualifying event that resulted in the loss of your group health coverage. The type of continuation coverage you qualify for is partially based on how many people were employed by your employer during the previous year.

• If you lose your job.
• If your hours are cut so you lose your group health coverage.
• When you lose your group health coverage because you become Medicare eligible, but your family members still need insurance.
• If you and your spouse divorce or legally separate, and your spouse and/or children still need insurance.
• If you die and your spouse and/or children still need insurance.
• When your dependent child reaches age 26 and loses his/her dependent status.

When you lose your group health coverage, you should contact your employer to find out what type of continuation coverage is available to you. The type of continuation coverage you qualify for is associated with the size of the employer that offers your group health insurance coverage. It is your employer’s responsibility to correctly calculate and report the number of employees to the required federal and state agencies. If you lose your group health coverage, you should receive a notice from your employer, plan administrator or insurer that explains your continuation coverage rights, election options and premium payments.

Each of the three types of continuation coverage (COBRA and two state continuation types) have different maximum coverage periods. But they will all terminate early if a premium payment is not made within the required time frame. Other reasons continuation coverage may terminate early include: Other group health coverage or Medicare becomes available, your group health coverage is reinstated, or termination of the policy (and no other policy is made available).

There are two types of Oregon state continuation coverage. They are described in state law under rules ORS 743.600-602 and ORS 743.610. They are different in several ways, including eligibility criteria, maximum coverage periods, enrollment requirements and cost. ORS 743.610 is the rule for smaller employer groups (less than 20 employees) and employer groups not subject to federal COBRA. The rule for larger employer groups (20 employees or more) is ORS 743.600-602.

You (the covered employee) must have had continuous health coverage under one or more employer group plans for at least three months prior to the date the most recent coverage ended. Your spouse and other covered dependents are eligible to continue coverage regardless of whether you elect to continue coverage or not.

You or your dependents are not eligible if:

• You are eligible for Medicare
• You eligible for the same coverage under any other program that was not covering you on the day before a qualifying event

You must notify Samaritan Health Plans in writing that you want to continue coverage by completing and submitting a  state continuation coverage election form.

You must do this within 10 days after the event that triggered the loss of eligibility for coverage, or 10 days after the date Samaritan Health Plans notifies you of your eligibility (the date on your election notice in your election packet), whichever is later. You must submit the necessary continuation form to Samaritan Health Plans within the required time period to continue your current group health insurance plan coverage. If you need Samaritan Health Plans to mail the required forms, you may call 800-832-4580 to request them. Forms will be mailed within two business days of the request.

If you fail to do as indicated above, you may lose the ability to continue your current group health insurance coverage.

Here are the forms for state continuation coverage under ORS 743.610:

 State Continuation Coverage Election – This form is required to elect continuation coverage.
 Address Notification – Use this form if you need to update your address or the address of a family member on state continuation coverage.
 State Continuation Report (C610) – Use this form to report Medicare or other coverage eligibility, to drop continuation coverage or drop a member off coverage, or to add a newborn or adopted child to continuation coverage.
 Member Grievances and Appeals Process – This document describes how to file a grievance and/or appeal.  
 Appeal Request – Use this form to submit an appeal in writing.

You must pay the full cost of the group health coverage directly to the employer. The employer will specify the cost of the insurance, the date by which payment must be made, and the manner in which payment must be provided. You must pay the entire premium by the due date provided on the premium rate sheet enclosed in your election packet. Contact your employer for more information about premium payments.

No. Family members can make different decisions about whether to continue their group coverage. For example, parents may find more affordable coverage for children under age 19 in the individual (non-employer sponsored) market. Family members electing independently may affect your premium rates.

You and your dependents may stay on continuation coverage for up to nine months unless one of the following occurs:

• A full and timely payment is not received.
• You or your dependent(s) become Medicare-eligible.
• You or your dependent(s) are eligible for the same coverage under any other program that was not covering you on the day before a qualifying event.
• The group health policy is terminated, unless your employer replaces the terminated policy with similar coverage under another group health insurance policy. 

For more information about this type of state continuation coverage, employees may contact Samaritan Health Plans Customer Service at 800-832-4580.

You may find additional information on the Oregon Division of Financial Regulation website.

• Your surviving, divorced or separated spouse who is 55 years old or older
• Your eligible dependent children

• When you and your spouse divorce
• When you and your spouse legally separate
• Upon your death

Please contact your employer for specific instructions on how to elect state continuation coverage under 743.600-602.

The general steps are as follows:

• You or your spouse must notify the plan administrator in writing of a legal separation or divorce within 60 days of the event. The notice must include the mailing address of your legally separated or divorced spouse.
• The employer must notify the plan administrator in writing of your death within 30 days of the event. The notice must include the mailing address of your surviving spouse. 
• Within 14 days of receiving notification of the event, the plan administrator must notify your eligible spouse that continuation coverage is available to elect. The notice must include an election form, premium amount due and method of payment and instructions for returning the election form.
• Your eligible spouse has 60 days after the date the notice was mailed by the plan administrator to elect.
• The initial premium must be paid to the employer within 45 days of the date of election.

If your eligible spouse fails to do as indicated above, or follow the specific instructions of the employer, he or she may lose the ability to continue his or her current group health insurance coverage.

If the plan administrator fails to meet the notification requirements, premiums must be waived from the date the notice was required until the date the notice is received by your eligible spouse.

The member must pay the full cost of group health coverage. In addition, a 2 percent administrative fee can be added to the cost of the coverage. The employer or plan administrator must provide the member the cost of the insurance, the date by which premiums must be paid, and the manner in which payment must be provided.

The employee is not eligible for this type of state continuation coverage. The eligible spouse must elect continuation coverage in order for the dependent(s) to get coverage.

Please contact your employer for questions about this type of state continuation coverage.

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 when you would otherwise lose your group health coverage. Employers with 20 or more employees who worked 50 percent of typical business days in the previous year must offer this coverage. It can also become available to members of your family who are covered under the plan when they would otherwise lose their group health coverage.

Beneficiaries are qualified after there has been a qualifying event. There are other special periods when a family member may be added to COBRA continuation coverage.

A qualified beneficiary is a person who was covered by a group health plan on the day before a qualifying event occurred. Qualified beneficiaries include you (as the subscriber), your spouse or former spouse, your dependent child, or other legal dependents as outlined in your member handbook.

Qualifying events are specific situations that happen to you, your spouse and/or dependent that result in a loss of group health coverage. Qualifying events include:

• Your termination of employment or a reduction in hours for reasons other than gross misconduct
• Your death
• You become entitled to Medicare
• You divorce or legally separate from your spouse
• Your child’s loss of dependent status under the plan

Qualifying events occur while you, your spouse and/or dependents are still receiving group health coverage. Second qualifying events occur after qualified beneficiaries are already receiving COBRA continuation coverage.

It is your responsibility to report a divorce, legal separation or your child’s loss of dependent status to your employer or plan administrator within the required time frame. If these events occur while on COBRA continuation coverage, report them to your employer or plan administrator following the instructions they have provided.  Termination/reduction in hours, death, or entitlement to Medicare must be reported to the plan administrator by the employer within 30 days of the event.

Please contact your employer or plan administrator for questions about COBRA continuation coverage.

In addition, the Department of Labor publishes a helpful resource for employees, An Employee’s Guide to Health Benefits Under COBRA.

When you have COBRA continuation coverage, the plan benefits are the same as what you had as an active member under the group health plan. When you elect COBRA, you may select from the coverage plans you had before the event. The same plan options available to plan members not on COBRA are available to COBRA members.

Each qualified beneficiary has independent election rights. This means all family members do not need to make the same coverage elections, and can make separate choices. You should contact your employer for specific information on how this might affect your premium amounts.