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• CITY OF LAKEVILLE
DAKOTA COUNTY, MINNESOTA
RESOLUTION
Date October 20, .2003 Resolution 03-195
Motion by yellows Seconded by Luick
.Resolution approving the amendment to the
Continuation of insurance at the time of unpaid leave policy (COBRA).
BE IT RESOLVED by the City Council of the City of Lakeville that effective
January 1, 2004, the policy entitled "Continuation of Insurance at the time of unpaid
leave" is approved and replaces pages 62 and 63 in the Employment Benefits section of
the Employee Handbook.
APPROVED this 20t'' day of October 2003, by the City Council of the City of
Lakeville.
• CITY VILL
By:
Robert D. son, Mayor
T` EST
arlene Fridges, City k
CONTINUATION OF INSURANCE AT THE TIME OF
UNPAID LEAVE POLICY (COBRA)
POLICY
1. Consolidated Omnibus Budget Reconciliation Act {COBRA). Federal law,
known as COBRA, permits an employee to continue, at the employee's
expense, coverage under the City's insurance plan(s) at the. time of an
unpaid leave, resignation, termination, or retirement if the employee does
not have the same type of coverage under another employer group plan
and is not entitled to Medicare.
2. Continuation Period. The .length of continuation depends on the
Qualifying Event that applies to the employee's loss of coverage:
a. Eighteen (18) months, if the employee is presently a City employee
and the employee's coverage would stop because the employee's
employment is terminated or the employee's work hours are
reduced below the qualifying level for coverage (this period may be
extended to 36 months if another qualifying event, listed below,
occurs during the original 18-month period--an employee must
notify the Human Resources Department within 60 days of a
second qualifying event);. or
b. Thirty-six (36) months, if an individual is not an employee but is:
i. A separated or divorced spouse or child of a City employee;
ii. A surviving spouse or child of a deceased City employee;
iii. A child of a City employee, and is no longer an eligible
dependent as defined in the City insurance plan; or
iv. A dependent who loses dependent coverage when the City
employee becomes enrolled in Medicare benefits.
3. Termination of Continuation Coverage.
a. An employee's right to continuation coverage .will cease
immediately if the employee fails to pay the required premium due.
b. Plan eligibility ceases if:
4 a
i. An employee becomes covered under another group plan as
a result of employment, re-employment, marriage, or
remarriage; or
ii. An employee, an .employee's spouse, or an employee's
dependent children become enrolled in Medicare, in which
case coverage ceases for each individual so covered; or
iii. All City insurance plans under this policy are terminated.
4. Election and Premium Payment.
a. If an employee decides to continue group coverage, the employee
must complete an election form (provided by the City) and return it
to the address shown on the election #orm within sixty (60) days of
the later of the dates identified below, or the employee loses the
employee's right to elect coverage:
i. The date coverage is scheduled to stop; or
ii. The date the election packet is mailed.
b. It is the. employee's responsibility to pay the monthly premiums for
the plan(s) the employee wishes to continue.
c. For any participants after January 1, 2004, the cost of the plan will
carry a 2°to administrative fee for all eli i~participants. The fee will
be 1 % for participants that make arrangements to have the premium
aid b automatic withdrawals from his/her bank account.
cd. The law allows the employee to defer payment for the first monthly
premium for forty-five (45) days .from the day the employee signs
the election form. Premium payments for all subsequent months
should be received by the City by the first day of the month of
coverage, no later. than the 30th day of the month of coverage.
Failure to make timely payment will be cause for termination of
.coverage, with no opportunity for reinstatement of coverage.