1. Does your in-house administrator have a COBRA procedures manual which is strictly adhered to?
2. Were your COBRA Policies and materials developed with the aid of an ERISA attorney?
3. Do you provide written notification of COBRA rights to each newly-covered employee - and each covered spouse as well?
4. As of this time, have you provided written notification of COBRA rights to all currently covered employees and covered spouses?
5. Do you send your notices via First Class Mail, addressed to both the employee and spouse at their last known address, with a separate notice sent to spouses living at different addresses?
6. Do you allow independent elections among Qualified Beneficiaries if they each request such?
7. Do you provide a forty-five day grace period to pay the initial premium?
8. Is your staff trained to answer attorneys' questions challenging your position, and to provide accurate telephone assistance to Qualified Beneficiaries?
9. Are you sure that all COBRA notices, SPDs, letters and forms used are properly worded (in keeping with DOL and COBRA regulations), and UPDATED constantly to convey current COBRA requirements and rights?
10. Do your administrator's Qualifying Event notices properly and completely explain all COBRA requirements and rights?
11. Did you send a notice to all COBRA continuants prior to November 1, 1996, advising them of changes in COBRA, as mandated by HIPAA?
12. Have you changed the language on all of your COBRA forms to reflect the changes brought about by HIPAA?
If you answered "no" to any of these questions you have a serious risk
of non-compliance. For a free evaluation, call us at 787-725-5880.
PENALTIES FOR NON - COMPLIANCE
IRS:
$100 per day, per Qualified Beneficiary, excise tax assessed against
the employer up to $255,000 maximum
ERISA:
$110 per day per event penalty assessed against the plan administrator .
DO THE MATH:
An employer of 35 employees covered - for one month of non-compliance, will pay :
