Employee Termination

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There are several reasons why coverage would end on an employee and/or dependents.

Resignation/Separation

Employees who are either resigning from State employment or who are terminated by the University have coverage through midnight on the last day the member worked. Employees who terminate employment have the option to become a dependent of their State-employed spouse or civil union partner. Terminating employees will receive a COBRA eligibility notice from CMS if they are eligible to continue coverage. See COBRA information below.

Resigning faculty may maintain coverage during the academic summer break through 8/31/xx due to not returning for the fall semester. Employees should contact Employee Benefits for their options in retaining coverage over the summer months.

To resign your position from the University, complete a Resignation/Separation form.

Full-Time Equivalency (FTE) Change to Less than 50%

Coverage will also end for employees that have a change in their FTE to less than 50%. Coverage will terminate at midnight on the date of the change. Employees may then be covered as a dependent of their State-employed spouse or civil union partner.

Death

Coverage for a deceased member remains in force until midnight of the date of death. COBRA benefits are available for eligible dependents of deceased members. See chart below.

Termination for Nonpayment of Premium

If a member fails to pay the premium due when billed, the Group Insurance Division (GID) will terminate the member's coverage the first day of the month following the final notice due date. CMS will take action to collect all outstanding premiums which may include filing an involuntary withholding with the State of Illinois Comptroller.

NOTE: Employees and/or their dependents who have had coverage terminated for nonpayment of premium are not eligible to be covered under another member until all outstanding premiums are paid. Dependent coverage that is terminated due to nonpayment of premium will not be automatically reinstated. Members wishing to cover dependents must reenroll them upon returning to work.

Maximum Leave of Absence Period Reached

An employee's coverage terminates at midnight on the date that the maximum period allowed for a leave of absence is reached. Employees on an FMLA qualifying leave of absence that reach the maximum coverage period will be changed to a personal/general leave of absence.

Dependent Termination Reasons

An enrolled dependent's coverage terminates at midnight:

  • Simultaneously with the termination of the member's coverage.
  • On the last day of the month in which a dependent loses eligibility.
  • On the requested date of a voluntary termination due to a qualifying change in status.
  • On the requested date of a voluntary termination of a dependent in the two or more category that does not affect premiums.
  • On June 30th for dependents who are voluntarily terminated during the Benefits Choice Period.
  • On the date of the dependent's death.
  • On the last day of the month in which the employee fails to certify continued eligibility for coverage of the dependent child.

An enrolled dependent's coverage terminates on the day preceding the dependent's:

  • Enrollment in the Program as a member.
  • Divorce or civil union partnershp dissolution from the employee. The divorce or civil union partnership dissoltion terminates the coverage for the spouse or civil union partner and all applicable stepchildren or children of the civil union partner.
  • On the date preceding the dependent's entrance into the military service.

NOTE: Employees who fail to notify their GIR (Group Insurance Representative) within 60 days of the dependent's ineligibility will not receive a preium refund, nor will the dependent be eligible for COBRA.

COBRA

The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) provides eligible covered employees and their eligible dependents the opportunity to temporarily extend their health coverage when coverage under the health plan would otherwise end due to certain qualifying events. COBRA rights are restricted to certain conditions under which coverage is lost. The election to continue coverage must be made within a specified election period. If elected, coverage will be reinstated retroactive to the date following termination of coverage.

CMS will send a letter regarding COBRA rights. Premium rate information is based upon the plan(s) in effect at the time of termination and an enrollment form will be included with the letter. At no time is COBRA coverage provided to a qualified beneficiary or newly-acquired dependent unless the premium for the first period of COBRA coverage is paid.

Rates: Members whose coverage under the plan that has been terminated are responsible for 102% of the cost of the coverage. Click here for FY2017 COBRA Health and Dental Rates 

Enrollment Period: Qualfied beneficiaries have 60 days from the date of the COBRA notification letter to elect COBRA coverage. Enrollment will not be processed until the election form and required payments are received by the Premium Collection Unit. Once payment is received, coverage will be retroactive to the date of the qualifying event.

Electing Coverage: Members may elect member-only coverage and/or dependent coverage at the time of the qualifying event. Dependents may elect COBRA in their own right even if the member decides not to enroll.

Coverage Options

Health: Qualified beneficiaries may change health carriers at the time of initial enrollment.

Dental: Qualified beneficiaries may elect to not participate in the dental plan upon initial enrollment in COBRA. Those who are not participating in the dental plan when they lose eligibility may not elect to participate in the dental plan until the next annual Benefit Choice period.

Life: Life coverage is not provided uner COBRA; however, qualified beneficiaries may have the option to port or convert Basic and/or Member Optional Life coverage Click here for the Portability Form or here for Conversion Form.

The following chart lists all the termination types. Some members/dependents whose coverage has been terminated may not be eligible for COBRA benefits. COBRA letters are sent to the empoyees from CMS after the termination date.

Termination Types

MEMBERS

COBRA ELIGIBLE MAXIMUM ELIGIBILITY PERIOD COBRA INELIGIBLE
Terminate Employment for any reason 18 months Member Death
Maximum Leave of Absence Ends 18 months Depenent of Another Member
Change to less than 50% employment 18 months Nonpayment of Premium
Termination of Disability Benefits 18 months Gross Misconduct
  Members who opted out of coverage

DEPENDENTS

COBRA ELIGIBLE MAXIMUM ELIGIBILITY PERIOD COBRA INELIGBLE
Employee's Termination of Employment for any reason 18 months Dependent Voluntary Terminated
Employee's Termination of Disability Benefits 18 months Transfer to Another Member
Employee's Maximum Leave of Absence Period Expires 18 months Military Service
Employee's Loss of Eligibility Due to Reduction in Work Hours 18 momtns Enrolled as a Member
Dissolution/Legal Separation 36 months Untimely notification
Loss of eligibility as a Dependent Child or Domestic Partner 36 months  

EMPLOYEE'S DEATH

TERMINATION TYPE MAXIMUM ELIGIBILITY PERIOD
Spouse Under age 55 36 months
Spouse age 55 or older if already enrolled in Medicare 36 months
Spouse age 55 or older Until obtains Medicare or reaches the qualifiying age for Medicare
Dependent Child 36 months
Domestic Partner 36 months
Dissolution of Marriage or Civil Union Partnership* 36 months
Ex-spouse under age 55 36 months
Ex-spouse age 55 or older if already enrolled in Medicare 36 months
Ex-spouse age 55 or older Until obtains Medicare or reaches the qualifying age for Medicare
Stepchild or Child of a Civil Union Partner 36 months

*Dropping a spouse's coverage during the annual Benefit Choice Period in anticipation of a divorce, civil union partnership dissolution or legal separation will result in the spouse losing coverage effective July 1st. The spouse will be eligible for COBRA only once the divorce, dissolution or legal separation actually occurs. Spouses whose coverage was terminated due to a divorce, dissolution or legal separation must contact CMS COBRA Division office within 60 days of the event in order to be offered COBRA coverage.

Extension of COBRA benefits can be found in the Member Handbook on page 31.