Issue 7

As you approach your open enrollment period, it’s important to remember that COBRA-qualified beneficiaries have the same rights as active employees. During a typical open enrollment period employees are given the option to change their benefits as well as add or remove dependents. This same rule also applies to COBRA. COBRA regulations provide that a qualified beneficiary may change their coverage at open enrollment to the same extent that a similarly situated active employee can change under the plan.

If you are offering an open enrollment period to your active employees, where they are given the option to make changes to their benefits and/or dependents, you must offer those same open enrollment options to your COBRA participants. Here’s a look at the information and options you should make available to them:

Review of plan options

Provide open enrollment materials to each COBRA-qualified beneficiary and include the following information:

• The open enrollment period (including the deadline to submit requested changes)
• Plan information (medical, dental, and vision, as applicable)
• Rates for the upcoming plan year
• Steps the qualified beneficiary will need to take to renew/change coverage (such as completing and returning an attached open enrollment form)
• Contact information

Option to change plans

During an open enrollment, you must give qualified beneficiaries the same option to switch from one medical plan to another as you would a similarly situated active employee. In addition, COBRA-qualified beneficiaries must also have the option to elect plans of different types if similarly situated active employees are allowed. For example, if you offer medical and dental coverage under two separate health plans and a COBRA-qualified beneficiary initially elected medical only for COBRA coverage, that person must be given the opportunity to add dental coverage during the plan’s open enrollment.

Option to add dependents

During an open enrollment, you must also give COBRA-qualified beneficiaries the option to add dependents to their plan(s). If, for example, a COBRA-qualified beneficiary elected and paid for individual-only COBRA coverage at the time of the qualifying event, the person must be allowed to add family members to the COBRA coverage under the plan during any open enrollment period, to the extent that a similarly situated active employee can do so.

Don't forget about coupons!

Once the open enrollment period has ended and all updates have been made, it’s important to send new premium payment coupons with the new monthly rates to your COBRA participants. If you are using UPMC Benefit Management Services as your COBRA administrator, this is a standard step of our open enrollment service.

We hope these tips help as you approach your open enrollment period. We know that open enrollment is a busy time of year. Processing is time-consuming and requires a lot of effort and diligence, considering all that needs to be done: updating rates, creating and mailing materials, receiving and tracking open enrollment forms, and answering questions. We’re happy to help alleviate some of this burden for you by handling your COBRA open enrollment process for you. If you have any questions, you can contact your dedicated COBRA analyst at any time.

HSA Investments

Did you know that UPMC Consumer Advantage health savings accounts (HSAs) gain interest?

Cash account balances are initially invested in an FDIC-insured interest-bearing account with HealthcareBank, a division of Bell Bank, as custodian for members’ health savings accounts.

Once a member’s cash balance reaches $1,000, they can define a threshold for their balance to be swept into an investment account to invest their HSA funds.

Members can invest their HSA on the UPMC Consumer Advantage member website. First, the member clicks Manage Investments, then Setup Investment Transfers. A message will populate where the member can define a sweep amount. The sweep amount is the maximum amount that will be kept in the available cash account. Any funds that exceed the sweep amount are swept into the investment account in two business days.

Once the funds have moved to the investment account, the member can access the investment portal by clicking Manage Investments and choosing investment options.

When a member’s cash balance is below their threshold, investments are proportionally sold to be swept back to replenish the cash account back to the threshold.

Mutual funds are not FDIC insured, have no bank guarantee, and may lose value.

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The above information is for informational purposes only and is not legal or tax advice. UPMC Health Plan and UPMC Benefit Management Services do not provide legal or tax advice. For legal or tax advice, please contact your attorney or tax adviser.