Compliance Briefing Center

COBRA

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ARRA Update: Wageworks Action Plan

Now that the House and Senate have approved the Department of Defense Appropriation Act of 2010 and it has been signed by the President, the sixty day clock to meet the requirements has started ticking.  This extension will provide more relief for those hardest hit by the recession and, as with all new laws and regulations, leaves employers and administrators to sort out the details. The following summary is designed to provide you with our initial action plan.

The notification process to the current Assistance Eligible Individuals (AEIs) will be a significant undertaking and WageWorks® is already in the process of developing the communications that will be required to be provided to the different groups of AEIs.  As a result of this effort, we are currently assessing the impact and will communicate the cost of providing the individual notices to the AEIs.  The cost will be all inclusive to provide both the notices and process any applicable changes for this population.

There are several scenarios listed below, and each scenario requires a separate notice and, in some instances, a form in order to re-activate coverage.   The Qualifying Event Notification will be updated to advise future qualified beneficiaries of their extended rights under ARRA.

The current AEIs that will require notification of the impact to their continuation coverage fall into these groups:

  • Individuals terminated under COBRA, ARRA subsidy ended, but more than one month of COBRA continuation coverage could be available to them
  • Individuals who are enrolled in COBRA, receiving the ARRA subsidy, and whose 9 months have not been exhausted
  • Individuals who are enrolled in COBRA whose 9 month of ARRA subsidy have ended
  • Individuals experiencing a qualifying event with a loss of coverage date after November 1, 2009 through February 28, 2010 who have already been notified of their rights, but have not yet enrolled in COBRA
  • Ongoing individuals who will be sent a COBRA Notification since the date of enactment of the Department of Defense Appropriation Act 2010

WageWorks anticipates delivering these notifications by mid to end of January 2010 well in advance of the legislative deadline. This effort will minimize any delays in reactivating coverage for those that may already have terminated due to exhausting the ARRA subsidy.
At this time we are advising your COBRA participants to wait for more communication about the extension of the ARRA subsidy before requesting reinstatement or credits on their account.

We will continue to keep you informed.

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