COBRA - Continuation of Coverage: Equity-League Fund

What Is Continuation Coverage?

Federal law requires that most group health plans (including this Plan) give employees and their families the opportunity to continue their health care coverage when there is a "qualifying event" that would result in a loss of coverage under an employer's plan. Depending on the type of qualifying event, "qualified beneficiaries" can include the employee (or retired employee) covered under the group health plan, the covered employee's spouse, and the dependent children of the covered employee.

Continuation coverage is the same coverage that the Plan gives to other participants or beneficiaries under the Plan who are not receiving continuation coverage. Each qualified beneficiary who elects continuation coverage will have the same rights under the Plan as other participants or beneficiaries covered under the Plan, including open enrollment and special enrollment rights.

How Long Will Continuation Coverage Last?

In the case of a loss of coverage due to end of employment or reduction in hours of employment, coverage generally may be continued only for up to a total of 18 months. In the case of losses of coverage due to an employee's death, divorce or legal separation or a dependent child ceasing to be a dependent under the terms of the plan, coverage may be continued for up to a total of 36 months. When the qualifying event is the end of employment or reduction of the employee's hours of employment, and the employee became entitled to Medicare less than 18 months before the qualifying event, COBRA continuation coverage for qualified beneficiaries other than the employee lasts until 36 months after the date of Medicare entitlement. This notice shows the maximum period of continuation coverage available to the qualified beneficiaries.

Continuation coverage will be terminated before the end of the maximum period if:

any required payment for COBRA coverage is not paid in full on time,
the qualified beneficiary first becomes, after electing COBRA coverage, covered under another group health plan (as an employee or otherwise) that does not impose any pre-existing condition exclusion or limitation applicable to the individual,
the qualified beneficiary becomes entitled to Medicare benefits (under Part A, Part B or both) after electing continuation coverage,
the group health coverage provided to the qualified beneficiary is terminated (and the plan sponsor is not required by COBRA to provide other group health coverage that it maintains, if any), or
coverage has been extended for up to 29 months due to disability and there has been a final determination by the Social Security Administration that the individual is no longer disabled. In this case, coverage will end as of the month that begins more than 30 days after the date of such final determination.

Continuation coverage may also be terminated for any reason the Plan would terminate coverage of a participant or beneficiary not receiving continuation coverage (such as fraud).

You do not have to prove insurability to be entitled to continuation coverage. However, continuation coverage is provided subject to your (and your family members’) eligibility for coverage under the Plan. The Board of Trustees and its designees reserve the right to terminate continuation coverage retroactively if you (or a member of your family) are determined to be ineligible for coverage. Once your continuation coverage terminates for any reason, it cannot be reinstated.
Special Note for Participants on Military Leave: If you are on military leave, you may be entitled to continue coverage on a self-pay basis for 24 months under another law called “USERRA”. Please contact the Fund Office for more information regarding available coverage while on military leave.

When Will the Length of Continuation Coverage Be Extended?

Even if the maximum period of COBRA continuation coverage shown on the first page of this notice is 18 months, under certain circumstances that maximum period will be extended. If you elect continuation coverage when you are first eligible, an extension of the 18-month period of coverage may be available if a qualified beneficiary is disabled (for Social Security purposes) or a second qualifying event occurs. You must notify the Fund Office of a disability or a second qualifying event in order to extend the period of continuation coverage. Failure to provide timely notice of a disability or a second qualifying event may affect the right to extend the period of continuation coverage.

Disability

An 11-month extension of coverage may be available if any of the qualified beneficiaries is determined by the Social Security Administration (SSA) to be disabled. The disability has to have started at some time before the 60th day of COBRA continuation coverage and must last at least until the end of the 18-month period of continuation coverage.

Notice of a Social Security disability determination must be provided to the Fund Office in writing. The notice must include the covered employee’s name, the qualified beneficiary’s(ies’) name(s), the name of the person who has been determined to be disabled by the Social Security Administration and the date of the determination. In addition, you must submit to the Fund Office a copy of the Social Security determination.

The notice must be sent to the Fund Office within 60 days of the latest of: (i) the date of the disability determination by the Social Security Administration; (ii) the date of the initial qualifying event; or (iii) the date of the loss of coverage due to the initial qualifying event, and notice must be provided before the end of the initial 18-month COBRA continuation period.

Each qualified beneficiary who has elected continuation coverage will be entitled to the 11-month disability extension if one of them qualifies. If the qualified beneficiary is determined by SSA to no longer be disabled, you must notify the Plan of that fact within 30 days after SSA’s determination.

Second Qualifying Event

An 18-month extension of coverage will be available to spouses and dependent children who elect continuation coverage if a second qualifying event occurs during the first 18 months of continuation coverage. The maximum amount of continuation coverage available when a second qualifying event occurs is 36 months. Such second qualifying events may include the death of a covered employee, divorce or legal separation from the covered employee, the covered employee’s becoming entitled to Medicare benefits (under Part A, Part B, or both), or a dependent child’s ceasing to be eligible for coverage as a dependent under the Plan.

You must notify the Plan in writing within 60 days after a second qualifying event occurs if you want to extend your continuation coverage. The notice must include the covered employee’s name, the type of second qualifying event, the date on which the event occurred, and the name(s) of the qualified beneficiary(ies) whose coverage may be extended due to the second qualifying event. In addition, you must include with the notice a copy of the employee’s death certificate, divorce decree, proof of legal separation, or a copy of the child’s birth certificate or other appropriate proof, as applicable depending on the event.

How Can You Elect Continuation Coverage?

To elect continuation coverage, you must complete the Election Form and furnish it according to the directions on the form. Each qualified beneficiary has a separate right to elect continuation coverage. For example, the employee's spouse may elect continuation coverage even if the employee does not. Continuation coverage may be elected for only one, several, or for all dependent children who are qualified beneficiaries. A parent may elect to continue coverage on behalf of any dependent children. The employee or the employee's spouse can elect continuation coverage on behalf of all of the qualified beneficiaries.

If you elect COBRA continuation coverage through an HMO and you go on an extended tour (9 months or more), you may transfer to Cigna continuation coverage effective with the first day of the month following your sending a notification of an extended tour letter to HMO Coordinator, Equity League Health Trust Fund, 165 West 46th Street, New York, NY 10036. Upon your return, you may transfer to HMO continuation coverage effective with the first day of the month following your sending a notification letter to Fund Office.

We strongly advise that when you go on an extended tour you transfer your benefits to the Cigna continuation coverage, since the Cigna plan will allow you to seek medical care with any doctor in the country.

In considering whether to elect continuation coverage, you should take into account that a failure to continue your group health coverage will affect your future rights under federal law. First, you can lose the right to avoid having pre-existing condition exclusions applied to you by other group health plans if you have more than a 63-day gap in health coverage, and election of continuation coverage may help you not have such a gap. Second, you will lose the guaranteed right to purchase individual health insurance policies that do not impose such pre-existing condition exclusions if you do not get continuation coverage for the maximum time available to you. Finally, you should take into account that you have special enrollment rights under federal law. You have the right to request special enrollment in another group health plan for which you are otherwise eligible (such as a plan sponsored by your spouse's employer) within 30 days after your group health coverage ends because of the qualifying event listed above. You will also have the same special enrollment right at the end of continuation coverage if you get continuation coverage for the maximum time available to you.

How Much Does COBRA Continuation Coverage Cost?

Generally, each qualified beneficiary may be required to pay the entire cost of continuation coverage. The amount a qualified beneficiary may be required to pay may not exceed 102 percent (or, in the case of an extension of continuation coverage due to a disability, 150 percent) of the cost to the group health plan (including both employer and employee contributions) for coverage of a similarly situated plan participant or beneficiary who is not receiving continuation coverage. The required payment for each continuation coverage period is described in this notice.

The amount charged for continuation coverage may be adjusted due to changes in coverage. In addition, even in the absence of any changes in coverage, amounts charged for continuation coverage may change on a yearly basis or as otherwise permitted by applicable law.

The Trade Act of 2002 created a new tax credit for certain individuals who become eligible for trade adjustment assistance and for certain retired employees who are receiving pension payments from the Pension Benefit Guaranty Corporation (PBGC) (eligible individuals). Under the new tax
provisions, eligible individuals can either take a tax credit or get advance payment of 65% of premiums paid for qualified health insurance, including COBRA continuation coverage. If you have questions about these new tax provisions, you may call the Health Coverage Tax Credit Customer Contact Center
toll-free at 1-866-628-4282. TTD/TTY callers may call toll-free at 1-866-626-4282. More information about the Trade Act is also available at http://www.doleta.gov/tradeact/2002act_index.cfm.

When and How Must Payment For COBRA Continuation Coverage Be Made?

First payment for continuation coverage

If you elect COBRA continuation coverage, you do not have to send any payment with the Election Form. However, you must make your first payment for continuation coverage not later than 45 days after the date of your election. (This means 45 days after the date that your Election Form is post-marked, if mailed). If you do not make your first payment for continuation coverage in full within this 45-day period, you will lose all rights to COBRA continuation coverage under the Plan and your coverage will terminate as of the date indicated in this notice. Your first payment must include the periodic payments that are due through the date you make the first payment, subject to the 30-day grace period described below, thus you may be paying for more than one month of coverage. You are responsible for making sure that the amount of your first payment is correct. You may contact Fund Office to confirm the correct amount of your first payment.

No benefits will be paid or covered services provided until your payment is received. Therefore, even though you have 45 days to make your initial payment, it is advisable to include the premium payment together with the Election Form in order to receive prompt payment of claims. The initial payment must include premiums due for all months from the date on which your coverage terminates through the date of your payment. .

Periodic payments for continuation coverage

After you make your first payment for continuation coverage, you will be required to make periodic payments for each subsequent coverage period.The amount due for each coverage period for each qualified beneficiary is shown in this notice. The periodic payments are due on a monthly basis, but can be made quarterly. Under the Plan, each of these periodic payments for continuation coverage is due on the first day of the month for that coverage period. If you make a periodic payment on or before the first day of the month to which it applies, your coverage under the Plan will continue for that coverage period without any break. The Plan will not send reminder notices of payments due for these coverage periods.

Grace periods for periodic payments

Although periodic payments are due on the first day of each month, you will be given a grace period of up to 30 days after the first day of the coverage period to make each periodic payment. If you do not pay the premium by the first day of the month, during the grace period your coverage under the Plan will be suspended as of the first day of the coverage period and then retroactively reinstated (going back to the first day of the coverage period) if you pay before the end of the grace period. This means that any claim you submit for benefits while your coverage is suspended may be denied and may have to be resubmitted once your coverage is reinstated.

If you fail to make a periodic payment before the end of the grace period for that coverage period, you will lose all rights to continuation coverage under the Plan.

Your first payment and all periodic payments for continuation coverage should be made payable to the Equity-League Health Trust Fund and should be sent to 165 West 46th Street, 14th Floor, New York, NY 10036‑2582.

For More information

This notice does not fully describe continuation coverage or other rights under the Plan. More information about continuation coverage and your rights under the Plan is available in your summary plan description or from the Fund Office.

If you have any questions concerning the information in this notice, your rights to coverage, or if you want a copy of your summary plan description, you should contact the Fund Office at 165 West 46th Street, 14th Floor, New York, NY 10036‑2582..

For more information about your rights under ERISA, including COBRA, the Health Insurance Portability and Accountability Act (HIPAA), and other laws affecting group health plans, contact the U.S. Department of Labor's Employee Benefits Security Administration (EBSA) in your area or visit the EBSA website at http://www.dol.gov/ebsa/.
(Addresses and phone numbers of Regional and District EBSA Offices are available through EBSA's website.)

Keep Your Plan Informed of Address Changes

In order to protect your and your family's rights, you should keep the Fund Office informed of any changes in your address and the addresses of family members. You should also keep a copy, for your records, of any notices you send to the Fund Office.