Complying with the Consolidated Omnibus Budget Reconciliation Act (COBRA), ABX Air permits covered employees and dependents to temporarily continue health coverage (through “COBRA coverage”) at group rates if coverage ends for certain reasons. Covered participants may continue coverage under all health plans in which they were enrolled at the time of the event causing loss of coverage. This notice informs you of your COBRA rights and obligations. Both you and your spouse should read it carefully.
If you are a covered employee, you have a right to choose continuation coverage if you lose your group health coverage because of a reduction in your hours of employment or the termination of your employment (unless due to gross misconduct).
If you are the covered spouse of an employee, you have the right to choose continuation coverage if you lose group health coverage due to one of the following qualifying events:
Termination of your spouse’s employment (unless due to gross misconduct) or reduction in your spouse’s hours of employment;
Death of your spouse;
Your spouse becomes entitled to Medicare; or
Divorce or legal separation from your spouse.
A covered dependent child of an employee has the right to continuation coverage if group health coverage is lost due to one of the following qualifying events:
Termination of the employee parent’s employment (unless due to gross misconduct) or reduction in the employee parent’s hours of employment;
Death of the employee parent;
The employee parent becomes entitled to Medicare;
Parents’ divorce or legal separation;
Ceasing to be a “dependent child” as defined under this Plan.
Additionally, if an employee on a Family Medical Leave terminates employment during the leave or fails to return from the leave, the employee and covered family members may be eligible to continue coverage for up to 18 months.
The maximum period of COBRA coverage is 18 months if you lost group health coverage because of a termination of employment or reduction in hours. For all other qualifying events, the maximum period of COBRA coverage is 36 months.
Second Qualifying Event: The 18-month maximum period can increase to 36 months for dependents who have another qualifying event during the first 18 months of COBRA coverage. If the second event is legal separation, divorce or loss of dependent child eligibility, to qualify for the additional coverage you must notify Human Resources within 60 days of the second qualifying event.
Disability Extension: The 18-month maximum period can increase to 29 months if the employee or a covered family member is totally disabled. To qualify for this additional coverage, during the first 18 months of COBRA coverage you must present proof that Social Security considers the individual totally disabled at the time of termination/hours reduction or any time during the first 60 days of COBRA coverage. You must provide Human Resources with a copy of the Social Security determination letter (indicating entitlement to Social Security disability benefits) within 60 days of the date of the determination and within the initial 18 month period. The extension will be available to the disabled individual and covered family members.
You or a family member has the responsibility to notify Human Resources within 60 days of a divorce, legal separation, or a child’s loss of dependent status. If you fail to notify Human Resources during the 60-day notice period, family members who lose coverage will not be able to elect COBRA coverage. If Human Resources is properly notified, ABX Air will send a COBRA Explanation and COBRA Election Notice. Similarly, Human Resources will send you a notice of your right to elect COBRA upon the occurrence of any other qualifying event. You and your dependents must keep Human Resources informed of any change of address.
When you become eligible for COBRA coverage, you will have 60 days to complete and return your election form to Human Resources. This 60-day period runs from either the date active coverage ends or the date Human Resources sends you notice of your right to elect COBRA coverage (whichever is later). If you do not return the COBRA election form by that date, you forfeit your right to COBRA coverage. Each covered participant has an independent right to elect COBRA coverage. Example: A covered spouse or child could elect COBRA coverage when an employee terminates, even if the employee does not.
If you elect COBRA coverage, you will have 45 days from the date of your election to make your initial payment. Your initial payment must include the cost of coverage from the date you lost coverage through the last full month before you pay. After your initial payment, premiums are due on the first day of each month. Premium payments (except the initial payment) are subject to a 30-day grace period. If your premiums are not sent by the specified due date, your coverage will end and you cannot reenroll in COBRA coverage.
COBRA coverage is identical to the coverage provided under the plan to similarly situated active participants or family members. Any Plan changes which apply to active participants will also apply to COBRA participants. To change benefits or add dependents (except newly acquired dependents), you must wait until open enrollment. In general, added dependents do not have COBRA rights, so their coverage ends when yours does. However, the former employee’s child born or adopted during the COBRA coverage period will have the same COBRA rights as a child who was covered at the qualifying event.
Your COBRA coverage will end before your maximum period of COBRA coverage if:
You (employee, spouse, or child) don’t pay the required premium on time
You (employee, spouse, or child) become entitled to Medicare
You (employee, spouse, or child) become covered under another group health plan as an employee, spouse, dependent child or otherwise. (However, if the other plan limits or excludes coverage for your preexisting health condition, COBRA coverage will end when the limit or exclusion no longer applies.)
ABX Air and its subsidiaries no longer provide any group health coverage, or
COBRA coverage is extended because of Social Security disability, but the disabled family member (employee, spouse, or child) loses entitlement to Social Security disability benefits. (Coverage will end on the last day of the month following the month Social Security determines the family member is no longer disabled. The first 18 months of COBRA coverage are available regardless of when Social Security disability benefits are lost.)
Your COBRA rights are subject to change. Coverage will be provided only as required by law. If the law changes, your rights will change accordingly.
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