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Aetna Federal COBRA & CalCOBRA Requirements Update

Apr 10, 2009


Federal COBRA & State Continuation Requirements - April 9, 2009 
Aetna previously distributed an overview of the American Recovery and Reinvestment Act of 2009 as it pertained to the COBRA Subsidy Law. Today, we are pleased to pass on details and resources from Aetna relating to their role in the administration of Federal COBRA and state continuation in California, i.e. CalCOBRA in addition to other states.

Topics addressed within this communication are:
Please note that this communication will not address all unanswered questions pertaining to the administration of state continuation in California. Aetna is developing the necessary processes that will allow them to provide this service and properly administer the premium subsidy outlined in the ARRA. This includes changes in:
When more details become available, we will update you as soon as possible.


FEDERAL & STATE CONTINUATION REQUIREMENTS

FEDERAL REQUIREMENTS (employers with 20+ employees)
Employers are responsible for administering COBRA, although they may designate another organization (such as Aetna) to administer the program for them. As a result of the ARRA, employers fund the subsidy and are reimbursed through a payroll tax credit. Click here for more information.

STATE CONTINUATION REQUIREMENTS (employers with < 20 employees)
California is one of the many states requiring employers with fewer than 20 employees to continue group coverage for terminated employees. The ARRA mandates the COBRA subsidy for these members as well, but requires carriers (such as Aetna) to fund the subsidy and be reimbursed through the carrier's payroll tax credit.

As noted above, Aetna is still developing the necessary processes that will allow them to provide this service and properly administer the premium subsidy outlined in the ARRA.

STATE CONTINUATION EMPLOYER MAILINGS
To ensure compliance with the ARRA, Aetna began sending mailings this week to employer groups with less than 20 employees.

EMPLOYER ACTION IS REQUIRED - EMPLOYERS RECEIVING THIS MAILING
MUST RESPOND TO AETNA REGARDLESS OF WHO WILL ADMINISTER STATE CONTINUATION

( I ) Employer Mailings - AETNA Administered
Aetna is responsible for state continuation in the following states*: AR, CA, FL, KS, KY, MD, MS, NE, NH, NV, OK, RI, and VT.

Employers in these states will receive the following materials:

( II ) Employer Mailings - EMPLOYER Administered

Employers in the following states are responsible for administering state continuation*: CO, CT, GA, HI, IA, IL, IN, LA, MA, ME, MN, MO, NJ, NY, NM, NC, ND, OH, OR, SC, SD,TN,TX, UT, VA, WA, WV, WI, WY and DC.

Employers in these states will receive the following materials:

AETNA HMO COBRA HOME BILLING SERVICES

With the exception of California, Arizona and Washington, Aetna will no longer offer their HMO COBRA Home Billing Service due to the COBRA-related changes associated with the ARRA. This change will go into effect May 1, 2009. This service provided COBRA eligibility maintenance and billing to Aetna's HMO customers upon request at no additional charge.


EMPLOYER NOTIFICATIONS
Employers who elected Aetna's COBRA Home Billing Service will be notified this week of the discontinuation. The targeted letter will be based on the group size and location* and will include a list of names and addresses of customers and members currently being home billed.
Communication Piece(s) based on group size
ADDITIONAL COBRA SUBSIDY RESOURCES
*state designations are subject to change.

Please contact your B&P Group Sales Representative if you have questions regarding the COBRA subsidy.


The information provided via B&P's COBRA Subsidy document and webpage are intended to provide guidance only.  They are for informational purposes and are not intended to interpret laws or regulations or to address specific client situations.  These resources will continue to be revised as additional information becomes available from insurance carriers and government entities.
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