New York SB5471/AB8400, which extends state continuation coverage for a period of 36 months, became effective July 2009 for groups that renew or become effective on or after this date. SB 6V modified the application date to apply to all policies, regardless of the renewal date, as of November 1, 2009 and provided a special enrollment period for certain members who were not eligible under SB5471/AB8400.
- Increases the coverage period under COBRA and New York State continuation (mini-COBRA) from 18 to 36 months for fully insured, new and existing group (indemnity, PPO, POS, HMO and Healthy NY) medical plans.
- Provides an additional period of continuation to members who are eligible for, and who exhaust, their federal COBRA benefits. As such, all eligible employees may be eligible for a maximum period of continuation equal to 36 months.
- Does not apply to self-funded plans, stand-alone dental or vision.
Highlights of the new continuation law
- The 36 months of continuation benefits can be provided under New York State continuation or a combination of COBRA/New York State continuation.
- Individuals using up their COBRA continuation period may elect New York State continuation for an additional period not exceeding a total of 36 months of continuation, regardless of the reason they lost health coverage.
- Individuals who are on COBRA/State continuation when their group coverage begins or renews on or after July 1, 2009 are entitled to 36 months of coverage. The qualifying event does not have to occur after the sale or renewal.
- Small groups can be subject both to COBRA and to New York State continuation.
- SB 6V was signed into law on November 19 to close a gap in the original bill. As a result, members who exhausted their continuation/COBRA coverage between July 1, 2009 and November 1, 2009, and prior to their plan’s renewal date, will be provided a special enrollment period and be entitled to the extended 36 months of continuation coverage.
- Individuals who secured other coverage that will result in a lapse in coverage, are not entitled to the extension. Members can only be reinstated with no lapse in coverage.
Here is a synopsis of the steps under each scenario. Please refer to federal COBRA guidelines. Here is how the new New York law will impact groups subject to COBRA and those for which only state continuation applies.
Groups not subject to COBRA
- The employer must provide the employee with a notice of the right to continue medical coverage at the time the coverage would otherwise terminate.
- The employee has 60 days following the date of termination, or the date he/she is notified of the right of continuation by either the employer or policyholder to elect the continuation and pay the premium.
Groups subject to COBRA
- The employer must provide the employee with a notice of the right to continue medical coverage at the time the employee’s COBRA continuation would otherwise terminate.
- The employee has 60 days following the date of his/her COBRA termination, or the date he/she is notified of the right of continuation by either the employer or policyholder, to elect the continuation and pay the premium.
Share election form with your clients
The New York Group Medical Expense Benefits Right of Continuation and Conversion Notice form can help your clients in offering COBRA or New York State continuation to their employees. This is not a required form. Your clients can continue to use their own forms and processes to notify their employees of their continuation options.
For more information about continuation
An informative Frequently Asked Questions document is available on the New York Department of Insurance’s website, along with a summary of the new law. You can also contact your Aetna account executive for more information.