skip to main content

County to support COBRA premium subsidy

When employees leave county employment, they may elect to pay a premium to continue their health care coverage under COBRA (Consolidated Omnibus Budget Reconciliation Act).

Under the American Recovery and Reinvestment Act, which took effect Feb. 17, 2009, the county will subsidize 65 percent of the COBRA premiums for medical coverage for employees who involuntarily lose their job with the county between Sept. 1, 2008, and Dec. 31, 2009. The premium subsidy can continue for up to a maximum of nine months, but it does not extend the COBRA eligibility period. A refund or credit will be applied to normal COBRA premiums paid on or after March 1, 2009, but not before that date.

For example, COBRA monthly premiums for an employee’s medical coverage alone can range from a low of about $422 for Group Health Bronze coverage to a high of about $655 for KingCareSM Gold coverage in 2009. With the premium subsidy, an involuntarily terminated employee will only pay about $148 for Group Health Bronze or about $229 for KingCareSM Gold.

If an employee was involuntarily terminated between Sept. 1, 2008, and Feb. 16, 2009, and did not enroll in COBRA or lost coverage during that time, he or she may be eligible to elect COBRA during a special election period. The county’s COBRA administrator, FBMC, will notify all assistance eligible individuals via mail.

If an individual becomes eligible for Medicare or another group health plan during the nine-month period or if the COBRA period expires, the subsidy will be discontinued at the time of other benefit eligibility or at the end of COBRA coverage. An individual receiving the premium assistance must notify the county on becoming eligible for Medicare or another group health plan.

The COBRA subsidy only provides assistance for medical premiums for the employee and eligible dependents enrolled on the plan before the employee was involuntarily terminated. Premium assistance is not available for domestic partners or the children of domestic partners because these groups are not recognized as eligible dependents under federal law. Dental and vision premiums are only eligible for the premium subsidy if the employee was not enrolled in a bundled medical, dental, and vision plan.

Former employees who believe they are eligible for the COBRA premium subsidy should contact FBMC at 1-800-342-8017 on weekdays from 4 a.m. to 7 p.m. Pacific.

Appeal process

Employees who are notified that they are not eligible for the COBRA subsidy have a right to appeal the decision with the Centers for Medicare and Medicaid Services by completing and submitting an application form. The form will soon be available and can be completed online or mailed or faxed as indicated in the instructions.

Employees are encouraged to contact the Department of Labor only after being notified by FBMC that they are not eligible for the subsidy. Before completing the Department of Labor application form, employees should be encouraged to speak with an Employee Benefits Security Administration benefits advisor at 1-866-444-3272.

Subsidy high-level process overview

The county will follow this process in administering the COBRA premium subsidy:

  1. Employee leaves county employment.
  2. COBRA information is forwarded to FBMC by Benefits Operations.
  3. FBMC forwards COBRA packet to employee with determination of eligibility for COBRA subsidy.
  4. If the employee agrees with the determination of eligibility, he/she sends in the COBRA payment to FBMC and begins his/her period of COBRA eligibility.
  5. If the employee does not agree with the determination of eligibility, he/she will need to follow the appeal process described above.
  6. The Department of Labor will make a final determination of the employee’s eligibility within 15 days of the receipt of the application form via online, mail or fax.
  7. If the employee’s appeal is successful, he/she will be provided with a COBRA packet that has been updated with the lower subsidy premium.

Resources