Group Administrator's Manual

General Guidelines on COBRA

If your group is subject to the Consolidated Omnibus Budget Reconciliation Act (COBRA), there are a number of requirements with which you, the employer or plan administrator, must comply. These include, but are not limited to, the following:

  • Notifying all employees and their covered dependents of their rights under COBRA when they first become covered under the group health plan, using correct and up-to-date language;

  • Notifying, within 14 days of a qualifying event, all employees and their covered dependents of their continuation rights, benefits, and premium rates for the plan(s) in which they are eligible, using correct and up-to-date language;

  • Adhering to election rights of qualified beneficiaries;

  • Correctly administrating coverage of COBRA continuants on an ongoing basis until rights to benefits are exhausted.

Please remember that the above information is a summary only. For full details, please refer to the actual COBRA regulations.

Under our contract with your group, Arkansas Blue Cross does not assume your (the employer's) obligation to provide benefits under COBRA if you, the employer, fail to provide these notices at the time specified, nor shall Arkansas Blue Cross be responsible for providing any COBRA notices to employees or dependents.

Questions regarding COBRA require application of a complex and constantly changing set of federal regulations. Therefore, acquiring competent COBRA advice requires legal counsel with expertise in COBRA. This is why we have contracted with WageWorks, the nation's largest COBRA administrator, to assist you in administering your COBRA obligations. If you choose not to use WageWorks, we ask that you seek legal counsel competent in the area of COBRA law.

Please remember if you are not in full compliance with COBRA, you may be liable for an IRS excise tax of up to $200 per employee for each day of noncompliance, and ERISA penalties of $110 per employee per day of noncompliance; court awards may involve claims costs, attorneys' fees and other expenses.

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General Notices of COBRA Rights and Obligations

The following is a brief summary of the process that occurs between Arkansas Blue Cross, WageWorks and the employer.

  • Employer notifies WageWorks of newly covered employees and dependents by submitting electronic forms to WageWorks via the Web, sending a file in WageWorks specifications or sending these notices to WageWorks by fax or mail using paper forms.
  • WageWorks sends out general notices via the U.S. Postal Service first-class mail once the group informs WageWorks of the newly covered employees and dependents and archives the notices.


Initial Qualifying Event / Election of Employee

Employer notifies WageWorks of the qualifying event within 14 days of the qualifying event by submitting electronic forms to WageWorks via the Web, sending a file in WageWorks specifications, or sending these notices to WageWorks by fax or mail using paper forms.

WageWorks sends out the Qualifying Event Notices via the U.S. Postal Service first-class mail with proof of mailing once the group informs WageWorks of the qualifying event, and archives the notices.

Employer notifies Arkansas Blue Cross to terminate coverage by writing the employee name, ID number, amount of adjustment, and if amount is "plus" or "minus," employees' names and contract number on page 1 of your bill with a minus sign and the amount of premium.

Employee/dependent(s) has 60 days — from the date of the notification to the employee or the benefit termination date, whichever is later — to elect COBRA coverage.

If the employee/dependent(s) elects coverage, WageWorks bills him/her for all premiums due to current date.

From the date of COBRA election, the employee/dependent(s) has 45 days to return the full payment to WageWorks.

When WageWorks receives payment, a form called a Participant Update (on pink paper, see sample form) is sent or faxed to the employer (usually a 48-hour turnaround).

Upon receipt of the Participant Update form, the employer is to fax the form to the Customer Accounts Division to reestablish appropriate coverage.

Customer Accounts Fax Number:

Or mail to:
Arkansas Blue Cross and Blue Shield
P. O. Box 2181
Little Rock, AR 72203-2181
Attn: Customer Accounts


Ongoing Administration

Relationship Between WageWorks and Employer

WageWorks bills COBRA continuants in advance, on or about the 19th of the month.

The COBRA continuant's premium payment must be postmarked on or before the applicable 30-day grace period expiration date.

WageWorks remits an activity report (Participant Status Report) and a check to the group for all premiums collected, on or about the 10th of the month after the month of coverage.

WageWorks notifies the group of all enrollment changes or terminations of COBRA coverage throughout the month by sending or faxing Participant Update forms.

Relationship Between Arkansas Blue Cross and Employer

Arkansas Blue Cross bills the group in advance for the following month of coverage.

Since the COBRA premium will not be sent to the group until the following month, Arkansas Blue Cross will bill in arrears for premium due, or refund the group premium paid whichever is applicable.

It is the responsibility of the group to notify Arkansas Blue Cross of any COBRA participant's enrollment changes or terminations by faxing the Participant Update form upon receipt from WageWorks to Customer Accounts at (501)378-3248.

If you, the group administrator, have questions about COBRA, and your employer is using WageWorks's services, please feel free to contact WageWorks's Enhanced Services Team at 1-888-678-4872 or

Please do not give the toll-free number or e-mail address to individuals insured through your employer group, as they will need to continue to call the toll-free number previously set up for them.

Also, should anyone have questions about this process, or become aware of any problems experienced while using this process, please let us know so that we can contact WageWorks for a response and action.