There are several tricky scenarios that arise when coordinating COBRA coverage under the Affordable Care Act (ACA).  Case in point: Alex lost his job in August and elected COBRA coverage. However, he subsequently stopped paying his COBRA premiums and his COBRA coverage ended effective 10-31-14. He thought that he could score more affordable coverage through the Marketplace, but soon learned that because he let his COBRA expire, he was not eligible to apply for Marketplace coverage until the next Open Enrollment period, and then, his coverage would not become effective until January 1.

In this crazy post-ACA world, everyone is struggling to learn how the new rules apply to COBRA administration.  Now more than ever, it is important to revisit the basic building blocks of COBRA.

On June 12, 2015, the Departments of Labor, Treasury and Health and Human Services finalized regulations explaining the requirement to provide a Summary of Benefits and Coverage (SBC).  The Affordable Care Act (ACA) created the SBC requirement to provide individuals with health plan information in an easily understandable format with the hope that these individuals could better compare health insurance options.

We’ve all heard that 50 percent of marriages end in divorce. Regardless of the accuracy of this statement, it is reasonably certain that divorce or legal separation will happen within a workforce with 20 or more full time employees (the federal COBRA threshold).  Thus, just like death, taxes, and Affordable Care Act reporting, divorce is one of those unpleasant certainties for which we must prepare.   

Employers establish wellness plans to promote healthy lifestyles among employees.  Healthier employees hopefully leads to better control of costs under the employer’s health plan.  However, the individuals responsible for the employer’s wellness plan compliance will likely be left with a headache.   

Thanks to the Affordable Care Act (ACA), the compliance spotlight has shifted away from COBRA. Some opinion pieces have even called for the death of COBRA. These opinions overlook many of COBRA’s key benefits. For example, COBRA allows participants to take advantage of dollars already spent to satisfy deductibles. Unlike Marketplace coverage, COBRA provides retroactive coverage - thus preventing a gap. COBRA also takes into account all of the members of the family (creating Qualified Beneficiaries), not just the employee.

On April 1, 2015, the IRS published its most recent Employee Plans Newsletter. You can access the newsletter at http://www.irs.gov/Retirement-Plans/Employee-Plans-News.