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:
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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The following is a brief summary of the process that occurs between Arkansas Blue
Cross, WageWorks and the employer.
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
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
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
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
WageWorks notifies the group of all enrollment changes or terminations of COBRA
coverage throughout the month by sending or faxing Participant Update forms.
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 CSEnhancedServices@conexis.com.
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.
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Arkansas Blue Cross and Blue Shield is an Independent Licensee of the Blue Cross and Blue Shield Association and is licensed to offer health plans in all 75 counties of Arkansas.
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