|
Effective: August 1, 2010 |
|
|
03.45.40ar1 - Minnesota COBRA Premium Subsidy (Archive) |
Archived: October 1, 2011 |
The Minnesota COBRA Premium Subsidy provides eligible individuals with a premium subsidy equal to 35 percent of the total premium for the continuation of health care coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA).
COBRA provides continuing health care coverage under an employer’s group health plan for former employees and qualified spouses, former spouses, and dependent children. While employers typically pay a portion of employees’ health care coverage costs, former employees pay the full premium for COBRA coverage. Individuals must elect COBRA coverage within 60 days of the date they receive notice from their employer that they are eligible for COBRA coverage. Individuals enroll in COBRA coverage through their employer or health plan.
A provision in the American Recovery and Reinvestment Act of 2009 (ARRA) federally subsidizes 65 percent of the COBRA premium for individuals who meet certain criteria. Employers or third-party COBRA administrators determine eligibility for the federal COBRA subsidy. To be eligible for the federal COBRA subsidy, an individual must:
l be involuntarily terminated from employment between September 1, 2008, and May 31, 2010; and
l be eligible for COBRA coverage as a result of that termination.
The Minnesota COBRA Premium Subsidy pays for the remaining 35 percent of an eligible individual’s COBRA premium. Premium payments are made directly to the employer or COBRA administrator. To be eligible for the Minnesota COBRA Premium Subsidy, an individual must:
l elect COBRA coverage;
l receive the federal COBRA subsidy; and
l be a Minnesota resident and otherwise eligible for a Minnesota Health Care Program (MHCP).
The Minnesota COBRA Premium ends when the enrollee is no longer eligible for the federal COBRA subsidy or on August 31, 2011, whichever comes first.
Additional eligibility factors and links to standard program guidelines are provided below.
Citizenship/Immigration Status.
Concurrent Eligibility with Other Minnesota Health Care Programs.
Minnesota COBRA Premium Subsidy and MinnesotaCare Four-Month Rule.
Application Process (standard guidelines)
People apply for the Minnesota COBRA Premium Subsidy by submitting the Minnesota COBRA Premium Subsidy Application (DHS-5847) to DHS. Applications can be downloaded from the DHS web site.
Minnesota COBRA Premium Subsidy applications received at a county agency should be faxed to MN DHS - COBRA at (651) 431-7595.
The Minnesota COBRA Premium Subsidy Application cannot be used to apply for any other MHCP.
Eligibility Begin Date (standard guidelines)
The effective date of eligibility is the date eligibility is approved. DHS will issue payments for unpaid COBRA premiums once eligibility is approved. COBRA premiums for months prior to July 2009 do not qualify for payment under the Minnesota COBRA Premium Subsidy.
Renewals (standard guidelines)
The eligibility period for the Minnesota COBRA Premium Subsidy is the number of months the enrollee meets eligibility criteria and receives the federal COBRA subsidy. Enrollees are not required to submit a renewal form to maintain eligibility.
Applicants are not required to submit verifications with their applications. DHS staff contact the applicant’s former employer or COBRA plan administrator to confirm enrollment in COBRA and eligibility for the subsidy.
Enrollees must report the following changes within 10 days:
l A change in their COBRA premium amount;
l Termination of their COBRA coverage;
l Eligibility for other group health care coverage or Medicare; or
l A change in address.
Social Security Number (standard guidelines)
Follow standard MinnesotaCare guidelines.
Minnesota COBRA Premium Subsidy enrollees are not required to document their citizenship or immigration status.
Residency (standard guidelines)
Follow the requirements in State Residence for Medical Assistance/MinnesotaCare Families.
Household Composition (standard guidelines)
Follow the guidelines set forth in Determining Household Size for MinnesotaCare.
Determine household size based on the information provided in the Minnesota COBRA Premium Subsidy Application (DHS-5847).
Asset Guidelines (standard guidelines)
Follow the MinnesotaCare guidelines set forth in Calculating Countable Assets.
Determine whether the applicant is within the MinnesotaCare asset limits based on the asset and household information provided in the application.
Follow the guidelines set forth in MinnesotaCare Income Calculation.
Determine whether the applicant is within the MinnesotaCare income limits based on the income and household information provided in the application.
Note: If the applicant has income or assets that exceed the MinnesotaCare limits, determine whether any children in the household are eligible for MinnesotaCare. In households where income exceeds $50,000 per year but is at or below 275 percent of the Federal Poverty Guidelines (FPG), children may be eligible for the Minnesota COBRA Premium Subsidy while their parents are not eligible.
Spenddowns/Premiums (standard guidelines)
Payments made by the Minnesota COBRA Premium Subsidy can be counted toward a household member’s Medical Spenddown. Accept a copy of the Minnesota COBRA Premium Subsidy notice (DHS-5847A) as verification of the COBRA premium. Contact DHS at (651) 431-3480 or (888) 702-9968 to get subsidy payment amounts for MA enrollees who do not have a copy of the subsidy notice.
Concurrent Eligibility with Other Minnesota Health Care Programs
Generally, individuals cannot be enrolled concurrently in the Minnesota COBRA Premium Subsidy and a MHCP. Medical Assistance (MA) enrollees do not need the Minnesota COBRA Premium Subsidy since their share of COBRA premiums may be reimbursed as cost effective health care coverage. Most individuals are ineligible for MinnesotaCare if they have other health coverage, such as COBRA coverage, due to MinnesotaCare insurance barriers.
However, under very limited circumstances, concurrent eligibility for MHCP and the Minnesota COBRA Premium Subsidy may occur. The Benefit Recovery Section (BRS) and DHS staff will work with county agencies and MinnesotaCare Operations to evaluate these circumstances and coordinate eligibility on a case-by-case basis.
Minnesota COBRA Premium Subsidy and the MinnesotaCare Four-Month Rule
Minnesota COBRA Premium Subsidy enrollees may wish to apply for MHCPs when their COBRA coverage ends. To facilitate a smooth transition between the Minnesota COBRA Premium Subsidy and MinnesotaCare, state law exempts former enrollees of the Minnesota COBRA Premium Subsidy from the MinnesotaCare four-month rule. Former Minnesota COBRA Premium Subsidy enrollees may be eligible for MinnesotaCare even if their COBRA coverage ended within the four months prior to MinnesotaCare enrollment.
Only household members who were enrolled in the Minnesota COBRA Premium Subsidy are eligible for the exemption from the MinnesotaCare four-month rule.
Example:
Diane and her two children, Greg and Laura, applied for the Minnesota COBRA Premium Subsidy. Diane was found ineligible for the subsidy because her income exceeds MinnesotaCare limits, but Greg and Laura were found eligible and enrolled in the subsidy. Diane later applies for MinnesotaCare for herself and her two children.
Action:
Diane is subject to the four-month rule because she was not enrolled in the Minnesota COBRA Premium Subsidy. Greg and Laura are exempt from the four-month rule.
DHS staff administering the Minnesota COBRA Premium Subsidy mail the HCAPP (DHS-3417) to households exiting the Minnesota COBRA Premium Subsidy. The application is stamped to indicate their former enrollment in the Minnesota COBRA Premium Subsidy.
When an individual or family applies for MinnesotaCare using a stamped application indicating former enrollment in the Minnesota COBRA Premium Subsidy, take the following steps:
1. Determine MinnesotaCare eligibility based on all eligibility criteria except the MinnesotaCare four-month rule. For individuals and families who do not meet all other MinnesotaCare eligibility criteria, deny MinnesotaCare eligibility following standard policies and procedures.
2. For individuals and families who meet all other MinnesotaCare eligibility criteria, review the application to determine whether the four-month rule must be waived. If the application information reports other health care coverage within the four months prior to applying for MinnesotaCare, assume it was COBRA coverage.
n For applicants who did not report other health care coverage within the past four months or who are children in households with income at or below 150% of the federal poverty guidelines (FPG) who had COBRA coverage end in the past four months, approve MinnesotaCare eligibility according to standard MinnesotaCare policies and procedures.
n For applicants who did report other health care coverage and who are not children in households with income at or below 150% FPG, waive the four-month rule and approve MinnesotaCare eligibility.
The law that exempts former Minnesota COBRA Premium Subsidy enrollees from the MinnesotaCare four-month rule expires on February 28, 2012.
Individuals lose eligibility for the Minnesota COBRA Premium Subsidy when they:
l Become eligible for other group health coverage or Medicare;
l Become otherwise ineligible for the federal COBRA subsidy;
l Lose Minnesota residency; or
l Die.
The Minnesota COBRA Premium Subsidy expires on August 31, 2011.