Employees eligible for COBRA will receive information following their qualifying event directly from Lifetime Benefit Solutions (formerly EBS-RMSCO), not the Employee Benefits Division. All questions regarding COBRA benefits after an individual is enrolled in COBRA should be directed to Lifetime Benefit Solutions at 800-828-0078. Employees currently enrolled in COBRA will receive information and payment premium coupons from Lifetime Benefit Solutions.
What is COBRA?
COBRA stands for Consolidated Omnibus Budget Reconciliation Act. Under the federal law, you and your dependents may temporarily continue medical, dental, or vision benefits coverage, as a result of a qualifying event, subject to certain conditions and your payment of contributions.
Who is eligible for COBRA?
COBRA rights are available to qualified beneficiaries following a “qualifying event” that would cause the qualified beneficiary to otherwise lose their benefit coverage. A qualified beneficiary may include the following individuals who were covered by the plans on the day the qualifying event occurred: You (Employee), your spouse, and/or your dependent child(ren).
Qualifying events are specific occurrences that would cause the loss of health benefits.
What are COBRA qualifying event occurrences?
|Qualifying Event||Qualified Beneficiaries||Length of Coverage|
|Reduction in number of hours of employment||Employee, Spouse, Dependent Child(ren)||18 months|
|Termination of employment (other than for misconduct) including retirement or layoff||Employee, Spouse, Dependent Child(ren)||18 months|
|Divorce, or legal separation||Spouse, Dependent Child(ren)||36 months|
|Death of the covered employee||Spouse, Dependent Child(ren)||36 months|
|Covered dependent child(ren) that no longer qualify as a "dependent" under the group plan(s)||Dependent Child(ren)||36 months|
Each qualified beneficiary has the right to elect COBRA coverage independently of one another. In considering whether to elect COBRA coverage, be aware that a failure to continue your group health coverage will affect your future rights under federal law.
In the case of a layoff, you may maintain coverage for the first 120 days, at the regular contribution rate. At the end of the 120 days, you have the option to continue coverage for an additional 14 months under COBRA. However, continuation of coverage may not extend beyond 18 months.
Extension of Coverage
1. Medicare Extension for Dependents - When the qualifying event is your termination of employment or reduction in work hours and you became enrolled in Medicare (Part A, Part B, or both) within the 18 months before the qualifying event, COBRA coverage for your dependents may last for up to 36 months after the date you became enrolled in Medicare. Your COBRA coverage may last for up to 18 months from the date of your termination of employment or reduction in work hours.
2. Secondary Qualifying Event - If, as a result of your termination of employment or reduction in work hours, your dependent(s) have elected COBRA coverage and one or more dependents experience another COBRA qualifying event, the affected dependents may elect to extend their COBRA coverage for an additional 18 months (7 months if the secondary event occurs within the disability extension period discussed below) for a maximum of 36 months from the initial qualifying event. The second qualifying event must occur before the end of the initial 18 months of COBRA coverage or within the disability extension period discussed below. Under no circumstances will COBRA coverage be available for more than 36 months from the initial qualifying event. Secondary qualifying events are:
- Your death;
- Your divorce or legal separation; or
- For a dependent child, failure to continue to qualify as a dependent under the plans.
3. Due to Disability - If you or your dependent qualifies for disability status under Title II or XVI of the Social Security Act during the 18 month continuation period, you and all of your covered dependents:
- Have the right to extend coverage beyond the initial 18 month maximum continuation period;
- Qualify for an additional 11 month period, subject to the overall COBRA conditions;
- Must notify the plan administrator within 60 days of the disability determination status and before the 18 month continuation period ends; and
- Must notify the plan administrator within 30 days after the date of any final determination that you or a dependent is no longer disabled.
The Social Security Administration (“SSA”) must determine that the disability occurred prior to or within 60 days after the disabled individual elected COBRA coverage. In addition, the 11 month disability extension will terminate for all qualified beneficiaries on the first day of the month that is more than 30 days after the date the SSA makes a final determination that the disabled individual is no longer disabled.
After a qualifying event, what steps do I need to take to continue my health benefits?
Your termination with the University will process on or after your termination date. It will take approximately three to four weeks from the cancellation of benefits, based on your termination date, for your information to process through to receive your materials from Lifetime Benefit Solutions.
First, within 14 days of receiving notification from the Plan Administrator, Lifetime Benefit Solutions is responsible for providing you and your covered dependent(s), a written notice of COBRA rights as well as the application for COBRA coverage.
Should the qualifying event be for either of the following reasons:
- Divorce or change in child's dependent status – you are responsible for notifying the Benefits Division within 60 days of the event.
- Death of Employee or termination/reduction in hours - the University is responsible for notifying the Plan Administrator of the qualifying event within 30 days of that event.
Once you receive your packet of information from Lifetime Benefit Solutions, you have 60 days from the date of notice to make your COBRA benefit elections. If electing to continue your coverage, due to COBRA law, you and Lifetime Benefit Solutions have the obligation to start COBRA benefits effective the first day after your termination from the Penn State benefit plan(s). This means that even though there may be a time period throughout the election process when you technically are not covered, upon your election and payment of COBRA benefits, you will be retroactively covered back to the date immediately after the termination of your Penn State benefits.
If you and/or your covered dependent(s) choose to elect COBRA coverage, you must submit your application for coverage to Lifetime Benefit Solutions, as will be indicated on the information you receive from them.
Premiums are due by the first of each month. Premiums will be adjusted each January 1 and the new rates for the calendar year will be reflected below. Please keep in mind that there is a 2% administration fee added to the premiums below by Lifetime Benefit Solutions:
|Coverage||PPO Blue||PPO Savings|
|Two Party or Parent/Child(ren)||$6.97|
Termination of Coverage
Coverage may be terminated earlier if:
- Premiums are not paid on time;
- Coverage is obtained through another group health plan that does not have any pre-existing condition limitation or exclusion. If such coverage is obtained prior to COBRA election, the COBRA coverage may not be terminated early;
- A qualified beneficiary ceases to be disabled during the period of extended coverage.