COBRA, EOB, R&C FAQs
Continuation of Coverage under COBRA
What is COBRA?
COBRA (the Consolidated Omnibus Budget Reconciliation Act of 1986) provides certain former employees, retirees, spouses, former spouses, and dependent children the right to temporary continuation of health coverage at group rates, when coverage is lost due to certain specific events.
When is someone entitled to get coverage under COBRA?
COBRA establishes specific criteria for plans, qualified beneficiaries, and qualifying events. Generally, an employee, or the employee's spouse, or dependent children who are covered by an NYU group health plan and lose coverage due to a "qualifying event" are eligible to continue coverage under COBRA.
In certain cases, a retired employee, the retired employee's spouse, and the retired employee's dependent children may be eligible for COBRA.
How do I find out about COBRA coverage and how do I elect to take it?
Shortly after you become covered under a medical plan, you will receive a General Notice of COBRA Coverage Rights. Upon termination of employment for any reason other than your gross misconduct, you will receive a COBRA Notification/Election Form. You must respond to this notice and elect COBRA coverage on or before the 60th day after the written notice is sent, or the day health care coverage ceased, whichever is later. Otherwise, you will lose all rights to COBRA benefits. If your covered dependent loses coverage due to a Qualifying Event, you must contact the Benefits Office to request a COBRA Notification/Election Form within 60 days of the event or your dependent loses all rights to COBRA benefits.
What is a qualifying event?
Examples of qualifying events are:
- Voluntary or involuntary termination of the covered employee's employment for any reason other than gross misconduct
- Reduction in the hours worked by the covered employee
- Divorce or legal separation of the covered employee
- Death of the covered employee
- Loss of dependent child status under the plan rules.
How long can I continue coverage under COBRA?
You will generally be eligible for coverage for a maximum of 18 months if the qualifying event is due to employment termination or reduction of hours of work. Certain qualifying events, such as loss of coverage due to a divorce, or a second qualifying event during the initial period of coverage, may allow you to receive a maximum of 36 months of coverage.
What happens when my child is no longer eligible for coverage under my NYU health plan?
Your dependent child will become eligible to continue coverage under COBRA for up to 36 months if they lose coverage under the plan.
How long after a qualifying event do I have to elect COBRA coverage?
Once you or your dependent(s) have become a "qualified beneficiary," you will be given an election period of at least 60 days, during which you may choose whether to elect COBRA coverage.
Each qualified beneficiary may independently elect COBRA coverage or you or your spouse may elect COBRA coverage on behalf of all other qualified beneficiaries.
If I waive COBRA coverage during the election period, can I still get coverage at a later date?
If you waive COBRA coverage, you may revoke the waiver if you do so before the end of the election period. After the 60-day election period, your eligibility to elect to continue coverage under COBRA will end.
How much will COBRA coverage cost?
When you were an active employee, your employer may have paid all or part of your group health premiums. Under COBRA, as a former employee no longer receiving benefits, you will usually pay the entire premium amount, that is, the portion of the premium that you paid as an active employee and the amount of the contribution made by your employer. In addition, there may be a 2 percent administrative fee.
As a Plan participant under COBRA, you will remain subject to the rules of the plan, including copayments and deductibles, and are subject to all Plan limits and maximums.
I have COBRA. Do I need Medicare?
Yes, COBRA is always secondary to Medicare. This means that it only pays after Medicare pays. If you do not enroll in Medicare when you become eligible for it, it will be as if you have no insurance.
If you have Medicare first and then become eligible for COBRA, you can enroll in COBRA. If you have COBRA first and then become eligible for Medicare, COBRA will not usually continue your benefits. You should enroll in Medicare as soon as you are eligible.
Can I have both COBRA and Medicare?
Whether you can have COBRA and Medicare depends on which one you had first. If you have COBRA and then become eligible for Medicare, your COBRA may end. If you have Medicare and then become eligible for COBRA, you can sign up for COBRA insurance and it will be secondary to Medicare.
Explanation of Reasonable & Customary (R&C)
What are Reasonable & Customary (R&C) charges?
Reasonable & Customary (R&C) charges are the normal range of fees for services charged by health care providers in your given geographic area (based on the zip code where the provider has their practice.) The NYU Point-of-Service Plans use a national database of health care provider charges to determine the Plans' R&C allowances.
An average price for R&C charges is determined for a particular zip code, any charges above that average are considered above R&C.
Are expenses that are above the R & C allowance credited to my annual deductible?
Expenses in excess of the R&C allowance are not reimbursed by the Plan, nor do they count toward your annual deductible or the Plan's out-of-pocket maximum.
You should contact your health care provider if you need to know whether a charge for a given procedure code is within the R&C allowance.
What happens if I go out of network?
If you are enrolled in one of the NYU Point-of-Service Plans, and you go out of network, any amounts your provider charges, which are above Reasonable & Customary or contracted rates, are your responsibility and are not credited to your annual deductible.
The Aetna and Oxford HMO Plans cover in-network services only.
How to Read Your Explanation of Benefits (EOB)
What is an Explanation of Benefits (EOB)?
The Explanation of Benefits (EOB) is a notification that a claim has been processed by your insurance company. It is not a bill.
Why do I need an EOB?
Your EOB is an important record of the services you received. It shows the date(s) you received the service, the amount that was billed by your provider, the amount that was paid, what copayments were applied to the bill, how much was credited to your annual deductible (if applicable), and the portion of the charges that were not paid.
How do I read the EOB?
Your insurance company tries to make the explanation easy to understand. However, the layout and design of EOB's from different insurance companies may be slightly different.
Generally, there are four major sections on any EOB:
1) Claimant Information:
- The name, address, and phone number of the insurance company who received the claim
- The name of the individual who has the insurance (member's name)
- The name of the patient
- The group number for the NYU insurance plan
- The claim number
2) Service and Coverage Information:
- The date(s) when services were performed
- Codes that identify the type of service provided
- The amount charged
- Deductibles and/or copayments that apply
- The amount that was or will be paid
- The balance that will be the responsibility of the patient
- additional information that you need to know about the claim. For example, if the claim was not paid in full, the EOB will note the benefit limitations or exclusions that apply
4) Patient Summary:
- Total billed
- Total benefits approved for payment
- Amount that may be owed to the provider.
What are Reasonable & Customary (R&C) Charges?
Reasonable & Customary (R&C) charges are the normal range of fees for services charged by health care providers in your given geographic area. Expenses in excess of the R&C are not reimbursed by the Plan. (See also, "Explanation of Reasonable & Customary Charges".)
What is a "Pended Claim"?
At times, a claim might be "pended" for additional information, either from you or from the provider of services. If any of your claims are pended, you need to be sure to take any additional steps required to properly resolve your claim.
I have a United HealthCare (UHC) plan and received a form called a Health Statement. Is this the same as an Explanation of Benefits (EOB)?
Yes, this is a new version of an EOB that UHC provides its members. In addition to the standard information listed above, the UHC Health Statement also provides personal information , from saving money on your course of treatment to reminders about immunizations and tests needed by you or your dependents.
What should I do with the EOB?
Each time you receive an EOB, you should review it closely and compare it to the receipt(s) or statement(s) that you received from your providers. You may receive more than one EOB if more than one physician or service provider was involved in your treatment. For example, if an x-ray was taken when you visited your doctor, both your doctor and the laboratory may bill your insurance company separately depending on how your health plan covers lab and X-ray procedures.
Should I save all my Explanation of Benefits (EOBs)?
Yes. It is a good idea to save your EOBs for at least a year in case questions come up about a particular claim. In addition, if you participate in a Health Care Flexible Spending Account (FSA) you may need your EOB to substantiate an expense you have submitted for reimbursement under the FSA plan.