Feds Push Back Health Coverage Deadlines for Katrina Victims

September 19, 2005 (PLANSPONSOR.com) - Federal officials have announced extension to health plan coverage deadlines so that employees and employers affected by Hurricane Katrina will have the much-needed additional time.

The relief provides additional time to comply with certain deadlines contained in the Consolidated Omnibus Budget Reconciliation Act (COBRA), the Health Insurance Portability and Accountability Act (HIPAA) and the rules for processing of health claims, according to the US Department of Labor’s news announcement.

“We want to make sure that hurricane survivors don’t lose health coverage or other important benefits because they were unable to meet the normal deadlines,” said Secretary of Labor Elaine Chao, in the news release.

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Officials warned that the deadlines could have “a profound impact on workers’ health benefits,” since workers could lose eligibility for the continuation of their health benefits or be cancelled for missed premium payments under COBRA. Workers could also become subject to preexisting condition exclusions preventing them from being covered for their current medical conditions by a new insurer, or lose the ability to join their spouse’s health plan. 

According to the DoL announcement, the extended time frames are as follows:

  • Under the general HIPAA rules, prior credit may be disregarded if a person goes without coverage for 63 days. This time period has been extended to allow Katrina victims more time to secure health coverage without losing coverage for preexisting health conditions
  • Katrina victims now have more time to request enrollment in other group health coverage. HIPAA also requires special enrollment rights upon certain events, such as loss of other coverage, but only if an individual requests enrollment within 30 days of the loss.
  • Katrina victims now also have more time to request continuation coverage under COBRA rules. The general COBRA rules allow 60 days to request COBRA coverage.
  • The COBRA rules also govern timing of premium payments.   A grace period has been added to give victims more time to make their COBRA payments.
  • EBSA is requiring plans to extend time frames for affected individuals to file a benefit claim and to file an appeal.
  • Plans must provide certain notices in connection with the HIPAA portability and COBRA continuation provisions within certain time frames.   The agencies are extending these time frames for plans that cannot make their disclosures on time due to the hurricane.

For more information on Hurricane Katrina relief, contact the department at 1-866-4USA-DOL or EBSA at 1-866-444-3272. Additional information is  here .

Drugmaker Cleared of COBRA Notice Wrongdoing

September 16, 2005 (PLANSPONSOR.com) - A Delaware federal judge has thrown out part of a lawsuit filed by a former AstraZeneca Pharmaceuticals employee over a required health coverage notice, but refused to dismiss the plaintiff's Family and Medical Leave Act (FMLA) allegations.

US District Judge Kent Jordan of the US District Court for the District of Delaware cleared the prescription drugmaker of any wrongdoing in providing health coverage notice under the ConsolidatedOmnibusBudgetReconciliationAct ( COBRA ).

Jordan ruled that COBRA requires only a good faith effort to provide notice of COBRA rights and that AstraZeneca had no duty to ensure that plaintiff Marybeth Farrell received the election notice. Jordan   concluded that AstraZeneca, through its TPA, had made a good faith effort to notify the employee of her COBRA rights.

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However, Jordan ruled that Farrell had put forth a strong enough case on allegations the company retaliated against her by disciplining and then firing her in January 2004 because of her FMLA complaints that the remainder of her suit should proceed.

Despite Farrell’s assertions that her work performance had not been questioned before the medical leave issue arose, the company claimed her supervisors had been having problems with her work for some time. Not only that, but the employer alleged that Farrell became hostile at work after she returned from her leave and that customers and clients complained about her behavior.

The ruling is  here

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