by kcano » Tue Nov 04, 2008 12:19 am
This benefit has a maximum amount the employer will pay out - per year. Once the employee or family members reach that maximum, then nothing more is paid. The benefit begins again the next plan year.
Posted: Tue Nov 04, 2008 08:26 am Post Subject:
Are you referring to the Health Reimbursement Arrangement (HRA) offered by the employers where the benefits are paid upto a certain annual limit? however, the plan is required to meet the state guidelines and hence would comply with the COBRA requirements. In fact, all the employer funded health plans are subject to COBRA.
However, I would suggest that you get the confusions clarified by the human resource department of the company.
Posted: Tue Nov 04, 2008 08:38 am Post Subject:
The premium for the COBRA needs to be determined on the past-cost basis or by the actuaries. The employer, however, is allowed to determine the premium by dividing the maximum benefit payable for COBRA by 12 (number of months). Also, in addition to the premium the plan may charge administrative expenses upto 102%.
However, if the plan is a new one, where the past records are not available, actuarially determined premium rate is the only option.
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