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COBRA Administration

The Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA") became law on April 7, 1986. Both the IRS and the U.S. Department of Labor share in the administration and enforcement of COBRA. COBRA mandates that employers offer terminated employees (and their qualified dependents) the ability to temporarily maintain their current group benefits by self-paying the monthly premiums.

Exceptions to COBRA include: (1) Employers with fewer than 20 employees with group benefits (although states such as California and others have implemented their own versions of COBRA); (2) Government employers (federal and state); (3) Church plans; and (4) Employers with benefits that do not satisfy the "group" plan definition for COBRA purposes.

Generally, COBRA benefits are available for up to 18 months for qualified employees, their spouses and dependents if the qualifying event is due to the employee’s termination or reduction of employment. An extension is available for up to a total of 29 months for employees that are disabled at any time during the first 60 days of COBRA coverage. This also applies to the disabled employee’s non-disabled qualified beneficiaries. Coverage for up to 36 months is available for spouses and dependents of a qualified employee facing a loss of employer-provided coverage due to an employee’s death, divorce or legal separation, or certain other "qualifying events."

As a third party administrator, Interactive Medical Systems performs the following services for our COBRA clients:
  • Initial COBRA Notification
  • Rights mailing
  • Election form mailing for each qualifying event with USPS Proof of Mailing
  • Certificate of Creditable coverage -- as required under HIPAA 96
  • Acknowledgment of elected coverage
  • Monthly premium billing
  • Insufficient funds handling
  • Remittance of premiums
  • Medicare age handling
  • Verification of accuracy and timeliness of payment
  • Manage of secondary events
  • Administer Medicare disability
  • New Plan Notification
  • Termination notifications
  • Dependent age monitoring
  • Monthly Employer Reports

We provide answers to COBRA questions for employees, beneficiaries, and you. The services that we offer to our COBRA clients reach far beyond mere legal Compliance. With our COBRA service we also offer the peace of mind that your COBRA/HIPAA needs and requirements are being met by our knowledgeable staff of trained and caring individuals