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COBRA was enacted in 1985 to provide access to affordable health insurance when an employee loses a a job, is laid off, retires, or when a person receiving health coverage under a spouse's plan divorces or is widowed. The employer must permit "qualified beneficiaries: to elect to continue there health insurance under the plan for 18, 29, or 36 months, depending on the "qualifying event". The employee may not be required to pay more than 102% of the plan's cost. Notices are required when the employee dies, is terminated, has a reduction in hours, is divorced, is entitled to Medicare coverage, has a child that ceases to meet the insurance eligibility requirements, fails to return from FMLA, or is disabled.
The excise tax is $100 per day per qualified beneficiary for the duration of the noncompliance period, with a maximum of $200 per day per family, regardless of the number of qualified beneficiaries. Some courts have held employers liable for insurance claims when the notices were not made on a timely basis.
Services
The W&A, Inc. COBRA program provides the employer with the ability to meet its obligations under the law and to give the appropriate initial notices as well as the qualifying event notices. W&A will track the COBRA participants and report to the employer the status of all qualified individuals.
Administration
Your assigned plan administrator is constantly studying the latest regulations from the Department of Labor, the Internal Revenue Service and other governmental agencies in order to keep up with the ever changing nature of compliance.
As part of the routine service provided by W&A, Inc., a consultant is available to help with questions concerning tax law changes, and plan interpretation. The consultant and plan administrator are also available for consultations.