The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) provides for continuation of health coverage for your spouse and Dependent Children, if you lose coverage under the Plan due to a qualifying event. Your Dependents may continue health coverage for a limited period of time by making self-payments to the Plan.
If your Dependents lose eligibility because of the qualifying event of your death, your entitlement to Medicare, divorce or legal separation, or loss of Dependent status they may elect COBRA Continuation Coverage.
You and your Dependents may choose individual coverage or family coverage.
Eligibility for COBRA Continuation Coverage
If your Dependents are eligible for COBRA Continuation Coverage, they are considered qualified beneficiaries, meaning they were covered by the Plan on the day before the qualifying event.
If your Dependents marry, have a newborn Child, or have a Child placed with them for adoption while they are enrolled in COBRA Continuation Coverage, they may enroll that spouse or Child for the balance of the period of their coverage. They must complete the enrollment within 30 days after the birth, marriage, or placement for adoption. These Dependents who are added to your Dependent’s COBRA coverage will have COBRA coverage, but will not have all of the rights of a qualified beneficiary (such as adding additional beneficiaries).
Scope of COBRA Continuation of Coverage
If your Dependents choose COBRA Continuation Coverage, they are entitled to the same type of coverage that they had on the day before the date of the event that triggered COBRA. If there is a change in the health coverage, including Prescription Drug coverage that is provided by the Plan to similarly situated Participants, that same change will be made to COBRA Continuation Coverage.
Qualifying Events That Trigger COBRA Continuation Coverage
If your Dependents experience a qualifying event that causes them to lose coverage, they will be considered qualified beneficiaries, and the Fund will send them a COBRA Election Notice and a form for them to elect coverage. The qualifying events under which your Dependents may lose coverage under the Plan and the period of time for which they may make self-payments to continue benefits are described below.
Your spouse becomes a qualified beneficiary if he or she loses coverage because any of the following qualifying events:
- Your death,
- You and your spouse become divorced or legally separated, or
- You become entitled to Medicare benefits under Part A, Part B or both. Becoming entitled to Medicare means that you: 1) were eligible for Medicare benefits, and 2) enrolled in Medicare (under Part A, Part B, or both). The entitlement date is the date of enrollment in Medicare.
Your Eligible Dependent Children become qualified beneficiaries if they lose coverage because any of the following qualifying events:
- Your death,
- The Child’s parents become divorced or legally separated,
- The Child stops being eligible for coverage under the Plan as an Eligible Dependent Child, or
- You become entitled to Medicare benefits under Part A, Part B or both. Becoming entitled to Medicare means that you: 1) were eligible for Medicare benefits, and 2) enrolled in Medicare (under Part A, Part B, or both). The entitlement date is the date of enrollment in Medicare.
If your Dependents lose coverage under the Plan because of divorce, legal separation, your death, or loss of Dependent status, your Dependents may maintain COBRA Continuation Coverage for a maximum period of 36 months from the date coverage was lost.
Any qualified beneficiary who elects COBRA Continuation Coverage will pay the full cost of the coverage. The Fund can charge the full cost of coverage for similarly situated Retirees and their families (including both the Fund’s share and Retiree’s share, if any) plus an additional 2%.
The monthly cost depends on how many people are covered. Rates are provided for one person or for family coverage. If a qualified beneficiary adds Dependents that are acquired during the COBRA Continuation Coverage period and the qualified beneficiary was previously paying for individual coverage, the qualified beneficiary will be required to pay the higher rate.
The Trustees will establish the COBRA Continuation Coverage rates in accordance with ERISA and the Internal Revenue Code, the laws that govern the Plan. Generally, the Trustees will set new rates each Plan Year beginning July 1.
When you elect COBRA Continuation Coverage, you are required to make the first payment no later than 45 days after the date of your election, which is the date your COBRA Election Notice is post-marked, if mailed. If you do not make the first payment for continuation coverage in full within the 45-day deadline after your election, you will lose all rights to COBRA Continuation Coverage. You are responsible for contacting the Fund Office to make sure that the amount of your first payment is correct.
Your subsequent payments for COBRA Continuation Coverage are due on the first day of the month for which coverage is being provided. However, you have a 30-day grace period to make the payment. If the payment is not made when due, you will lose all continuation coverage rights under the Plan. COBRA Continuation Coverage will be provided for each coverage period as long as payment for that coverage period is made before the end of the grace period for that payment. However, if you pay a periodic payment later than the first day of the month for which it applies, but before the end of the grace period (the end of the month) for the coverage, coverage under the Plan will be suspended as of the first day of the month and then retroactively reinstated, going back to the first day of the month when your payment is received.
COBRA Continuation Coverage Notice and Election
You or your covered family member must inform the Fund Office of a divorce, legal separation, or of a Child losing Dependent status. You or your Dependent must provide written notice within 60 days of the event or the person affected forfeits the right to COBRA Continuation Coverage.
Your surviving Dependent spouse or Child should notify the Fund Office of your death within 30 days of the date that your surviving Dependents would otherwise lose coverage due to your death.
When the Fund Office is notified that one of these events has occurred, it will in turn notify your Dependents of the right to choose continuation coverage and the time frame within which they must make the election. If your Dependents are not entitled to COBRA Continuation Coverage, the Fund will notify them of their ineligibility in writing.
Your Dependents have an election period of at least 60 days from the date the notice is provided to inform the Fund Office of their election of COBRA Continuation Coverage.
Your Dependents may elect individual coverage or family coverage. Once they make an election for COBRA Continuation Coverage, they cannot change it unless it is within the 60-day election period. This means that after the 60-day election period ends, if they elect individual coverage, they cannot change to family coverage (except as explained in the next sentence), and if they elect family coverage, they cannot change to individual coverage. However, if they elect family coverage for only two family members and one of the family members dies so that individual coverage would be less expensive, the surviving individual may change to individual coverage. The Plan will charge for the individual premium starting on the first day of the month following the day the covered family member dies.
COBRA Benefit Coverage
Under COBRA Continuation Coverage, your Dependents are entitled to the same type of coverage that they had on the day before the date of the event that triggered coverage. If your Dependents choose COBRA Continuation Coverage and make the required self-payments, the Welfare Fund will provide coverage for all medical, dental, prescription drug, wellness, Substance Abuse, hearing, and vision benefits under the Plan.
In addition, if there is a change in the healthcare coverage that is provided by the Plan to Retired Participants, that same change will be made to the COBRA Continuation Coverage of qualified beneficiaries.
Termination of COBRA Continuation Coverage
If your Dependent elects COBRA Continuation Coverage, coverage will terminate as of the date the first of any of the following events occur:
- Your Dependents do not pay the self-payment for COBRA continuation coverage within 30 days of its due date.
- Your Dependents become covered under another group health plan. Special rules exist concerning pre-existing conditions. Contact the Fund Office for details.
- Your Dependents become eligible for Medicare. Contact the Fund Office for details.
- The Welfare Fund no longer provides any healthcare benefits.
Availability of Other Coverage
There may be other coverage options for you and your family. With the implementation of the Affordable Care Act you are able to buy coverage through the Health Insurance Marketplace. In the Marketplace, you could be eligible for a new kind of tax credit that lowers your monthly premiums right away, and you can see what your premium, deductibles, and out-of-pocket costs will be before you make a decision to enroll. Being eligible for COBRA does not limit your eligibility for coverage for a tax credit through the Marketplace. Additionally, you may qualify for a special enrollment opportunity for another group health plan for which you are eligible (such as a spouse’s plan), even if the plan generally does not accept late enrollees, if you request enrollment within 30 days.
If you have questions about your COBRA Continuation Coverage, you should contact the Fund Office, or you may contact the nearest Regional or District Office of the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA). Addresses and phone numbers of Regional and District EBSA Offices are available through EBSA’s website at www.dol.gov/ebsa/.
Keep the Fund Informed of Address Changes
In order to protect your family’s rights, you should keep the Fund informed of any changes in the addresses of family members. You should also keep a copy, for your records, of any notices you send to the Fund.