Department of Labor Releases New FMLA Forms: May 2015

Over the Memorial Day holiday weekend, the Department of Labor published new FMLA forms. The new forms are good through May 2018.

Download the new forms:

 

This content is provided for informational purposes only.  While we have attempted to provide current, accurate and clearly expressed information, this information is provided “as is” and MNJ Insurance Solutions makes no representations or warranties regarding its accuracy  and completeness.  The information provided should not be construed as legal or tax advice or as a recommendation of any kind.  External users should seek professional advice form their own attorneys and tax and benefit plan advisers with respect to their individual circumstances and needs.

What is the Difference between Federal COBRA and Cal-COBRA?

When an employer offers a group health insurance plan, such as medical, dental, or vision insurance, the employee and covered dependents (“Qualified Beneficiaries”) are provided an opportunity to continue their current plan at the individual/family’s expense when they have a qualifying event. Qualified events may include termination or reduction of hours of the covered employee’s employment for other than gross misconduct; divorce or legal separation from a covered employee; the loss of dependent status by overage dependent; the covered employee becomes eligible for Medicare; or the death of the covered employee. The continuation of group coverage option is known as either “Federal COBRA” or “Cal-COBRA.”

 

Listed below are some highlights of Federal COBRA vs. Cal-COBRA:

 

 Federal COBRACal-COBRA
Employer size20 or more employees more than 50% of the previous calendar year2-19 employees
Who is eligible?Covered Individual and covered spouse/dependents at the time of the qualifying eventCovered Individual and covered spouse/dependents at the time of the qualifying event
Who sends the COBRA Notice to the individual and qualified beneficiaries?Either the employer or a third-party administrator sends the COBRA notice within 30 days of the qualifying event.Employer must notify the insurance carrier and the carrier is responsible for sending out the Cal-COBRA notifications to the individual and qualified beneficiaries.
How long do they have to elect the COBRA/Cal-COBRA coverage?Employee and/or qualified beneficiary must elect coverage within 60 days of the qualifying event.Employee and/or qualified beneficiary must elect coverage within 60 days of the qualifying event.
How much does it cost to continue coverage?Cost is 102% of the regular premium for 18 months.NOTE: premium may change within that period, depending on plan year and renewal rates with insurance carriers.Cost is 110% of the regular premium for 18 months.NOTE: premium may change within that period, depending on plan year and renewal rates with insurance carriers.
Duration of Coverage ContinuationGenerally extends health coverage for 18 months. Individuals with certain qualifying events may be eligible for a longer extension (i.e. 29 or 36 months).Cal-COBRA allows individuals to continue their group coverage for up to 36 months. For individuals covered under Federal COBRA, Cal-COBRA may also be used to extend health coverage for a combined period of up to 36 months.

 

We typically recommend that employers with 20 or more employees outsource the COBRA administration to one of our preferred third-party administrators (TPA), as COBRA requires a number of plan notifications to take place at different stages in the COBRA process. Some of the notifications include:

 

The other option for Insurance coverage for individuals and qualified beneficiaries may be to elect Individual coverage, either “on” or “off-Exchange” plans, providing it is within their “Special Enrollment” period. If it is not “open enrollment” for individual coverage for on or off-Exchange plan and they had a qualifying event (as seen above), then they have up to 60 days to enroll under the special enrollment period. See blog post:   Help…I lost my job…Should I take COBRA or Covered California (Exchange)?

 

For more information, please do not hesitate to contact MNJ Insurance Solutions at (714) 716-4303.

 

Additional COBRA Information:

 

This material is for informational purposes only and not for the purpose of providing legal advise.  You should always contact your attorney to determine if this interpretation is appropriate for your particular situation.

Help…I Lost my Job…Should I Take COBRA or an Individual Policy?

COBRA is a federal law that requires employers of 20 or more employees with group health plans to offer employees, their spouse and dependents a temporary period of continued health care coverage if they lose coverage through the employer’s group health plan.  Employers who have not continuously had 20 employees are covered if they had at least 20 employees on more than 50% of  the typical business day in the previous calendar year.  Both full-time and part-time employees are counted to determine whether the plan is subject to COBRA.

 

Individuals are not obligated to participate in COBRA after leaving an employer or having a reduction in hours.  However, if an individual declines the initial offer of COBRA, he/she may qualify for “special enrollment” in Covered California health insurance or an “off-exchange plan” outside of the annual Open Enrollment period for Individual/Family coverage.  An “off-exchange plan” are plans that are offered by the carrier direct, rather than through Covered California.  In order t take advantage of the special enrollment in Covered California or “off-exchange plan,” the individual/family losing group coverage must apply for coverage no later than 60 days after their employer-sponsored plan ends.  It is also important to note that if an individual were to terminate their COBRA coverage during Open Enrollment of Covered California or elect an off-exchange plan, he/she cannot change their mind to go back to COBRA.

 

If an individual were to elect COBRA and loses his/her coverage (i.e. due to non-payment), he/she will NOT be eligible for special enrollment through Covered California, nor opt to an off-exchange individual plan at that time.  Outside of Open Enrollment, individuals qualify for special enrollment with Covered California or off-exchange individual plans if one of the following apply:

  • If former employer was responsible for remitting payments for the COBRA premium and fails to do so in a timely manner, therefore participant is cancelled due to group non-payment;
  • The COBRA participant moves out of the plan coverage area and there is not another option available (i.e. former employer offers HMO only plan and COBRA participant moves out of state and the HMO would no longer be a good option);
  • If the former employer cancels the group plan, therefore, COBRA is no longer available; or
  • The beneficiary has maximized their COBRA duration available under the plan.

 

Listed below are pros and cons of Electing COBRA vs. Enrolling in Covered California after an individual and qualified beneficiaries have had a qualifying event.

 

PROSCONS
ELECTING COBRA
  • The network of doctors and hospitals available in each plan and individual can continue the current benefits.
  • Covers more Rx than individual plans.
  • Transition and electing COBRA is typically an easier process than enrolling in Covered California.
  • If you are currently seeking treatment or under the care of a physician, it is easier to continue care under COBRA.
  • The total monthly premiums for the individual and qualified beneficiaries (family members previously enrolled on the plans) are paid by individual.
  • If the individual and qualified beneficiaries enrolled in COBRA, they cannot drop their COBRA plan and enroll in Covered California plan unless it is Open Enrollment for Covered California.
  • Depending on the level of benefits previously provided by the employer, the COBRA monthly premiums may be more expensive than desired coverage through Covered California (i.e. if employee or dependents may not need the rich covered previously offered by the employer).

 

ENROLLING IN COVERED CALIFORNIA OR “OFF EXCHANGE PLANS” WITH THE CARRIER
  • Depending on income, the individual and qualified beneficiaries may qualify for tax credit and/or subsidy (depends on household income – chart for 2015) with Covered California.
  • Copays and deductibles may vary with options for Covered California or “off-exchange plans.”
  • Individual has options to move to another carrier (plans for 2015) than what may be provided through their former employer.

 

  •  Doctors and hospitals may not be in the network for the Covered California or “off-exchange” plan option.  It is important to confirm preferred doctors before selecting a plan to ensure they are in the network.
  • Prescription plans offered through Covered California individual plans or “off-exchange” plans often cover a smaller list of formulary drugs than group plans.

 

Note: If you have a qualifying event, your spouse has other group coverage offered through his/her employer, you may also want to explore adding onto their group plan as an additional alternative.  If this is an option through his/her employer, it must be done within 30 days of the loss of coverage.

If you have questions regarding your personal situation, MNJ Insurance Solutions are able to assist and can be reached at (714) 716-4303.

 

More Resources:

COBRA vs. Exchange Coverage – Covered CA

 

Disclaimer:  The views and opinions expressed are those of the author and do not necessarily reflect the official policy or position of Covered California.  Any content provided by our bloggers or author is of their opinion and are not intended to malign any organization, company, government entity, anyone or anything.

This document is for general information only.  While we have attempted to provide current, accurate and clearly expressed information, this information is provided “as is” and MNJ Insurance Solutions makes no representations or warranties regarding its accuracy or completeness.  The information provided should not be construed as legal or tax advice or as a recommendation of any kind.  External users should seek professional advice from their own attorneys and tax advisors with respect to their individual circumstances.

California: New Legislation Amends the Paid Sick Leave as of July 13, 2015

paid sick leave

California’s new paid sick leave law, the “Healthy Workplaces, Healthy Families Act of 2014” (paid sick leave law) recently went into effect on July 1, 2015. Less than two weeks later, the law has already been amended. On July 13, 2015, the California legislature passed AB 304 amending the Paid Sick Leave Law. Governor Jerry Brown signed the bill into law the same day, as the law contains an urgency clause and the changes become effective immediately. Below is a brief description of the most important changes.

 

Who are covered workers?

The amendments clarify that the law applies to an employee who works in California for the same employer for 30 or more days within a year.

 

How does the employer calculate the sick leave accrual?

The original law provided only one method of calculating the sickleave a grill. Now, with the amendment, the employer can calculate sick leave pay for nonexempt employees by one of the following:

  •  Using the same calculation used to determine the employees regular hourly rate for overtime purposes, or
  • Dividing the employees total wages (excluding overtime) by the employee’s total hours worked in the full pay cycle of the prior 90 days of employment.

Under the amendment, the employer can calculate sick leave pay for exempt employees by the following:

  •  The same method of calculating wages as it uses for other forms of paid leave, such as vacation.

 

Alternative accrual method:

  • The paid sick leave amendment clarifies that employers may use methods of occurring sick leave other than the “one hour of sick leave for every 30 hours worked method” (1-in-30 method) used in the original language of the law.
  • Alternative accrual method, such as accrual by pay period or by months of employment are also valid, provided that the employees receive at least 24 hours (3 days) of sick leave by the 120th calendar day of employment or the employer’s sick leave year (calendar year or otherwise).

 

Employers existing paid time off (PTO) or sick leave policies:

Under the amendment of the Paid Sick Leave law, sick leave policies that existed before January 1, 2015 and that use an accrual method that differed from the “1-in-30 method,” have been grandfathered IF they meet the following three conditions:

  1. Accrual occurs on a regular basis;
  2. Employees receive not less than eight hours (one day) of sick leave within the first three months of employment or sick leave year; and
  3. Employees receive at least 24 hours of sick leave within the first nine months.

 

Listed below are some additional minor changes and clarifications to the paid sick leave law:

  • Employers with unlimited sick leave policies can state “unlimited” on employees paycheck stubs, rather than having to list a specific number of days or hours.
  • Employers do not have an obligation to reinstate an employee sick leave upon rehire within one year, if the employer paid the employee for the accrued sick leave upon termination.
  • Employers do not have an obligation to ask employees about the reason for taking the leave.
  • The language in the law of “a year” means a year of employment, a calendar year, or another employer designated 12 month period.
  • The amendment clarifies that employees have to work for 30 days for the same employer before becoming eligible for paid sick leave.

 

Action items for Employers to comply with Healthy Workplace Healthy Family Act of 2014 (AB 1522):

If an employer implemented a new sick leave policy, or revise their previous sick leave or paid time off policy within the last six months, to comply with the requirements of the paid sick leave law, most likely, no immediate action is required. However, if an employer failed to revise its existing policy prior to July 1, 2015, the employer should immediately review the newly amended law to ensure their sick leave policy complies with the amended Paid Sick Leave law. Regardless of whether the employer’s policy is grandfathered or not, the newly amended law allows the employer to have an option of an accrual method that may better meet its business needs. We recommend that you have your policy reviewed by your legal counsel/Business attorney to ensure compliance and the appropriate language in your policies.

In addition, the employer must do the following to comply:

  • Display poster on paid sick leave (Spanish) (Vietnamese) where employees can read it easily.Provide written notice to employees with sick leave rights (Spanish) (Vietnamese) at the time of hire.
  • Provide for accrual of one hour for every 30 hours worked and allow use of at least 24 hours or 3 days or provide at least 24 hours or 3 days at the beginning of a 12 month period of paid sick leave for each eligible employee to use per year.
  • Allow eligible employees to use accrued paid sick leave upon reasonable request.
  • Show how many days of sick leave an employee has available. This must be on a pay stub or a document issued the same day as a paycheck.
  • Keep records showing how many hours have been earned and used for three years. Affected employers may review the AB-1522 Employment: paid sick days Affected Employers may review the text of the amendments for the additional changes

 

For more information:  Healthy Workplace Healthy Family Act of 2014 (AB 1522)

  • Retaliation or discrimination against an employee who requests or uses paid sick days is prohibited. An employee may file a complaint with the Labor Commissioner against an employer who retaliates or discriminates against the employee for exercising these rights or other rights protected under the Labor Code.
  • Local offices are listed on our website at http://www.dir.ca.gov/dlse/DistrictOffices.htm.

 

This content is provided for informational purposes only.  While we have attempted to provide current, accurate and clearly expressed information, this information is provided “as is” and MNJ Insurance Solutions makes no representations or warranties regarding its accuracy  and completeness.  The information provided should not be construed as legal or tax advice or as a recommendation of any kind.  External users should seek professional advice form their own attorneys and tax and benefit plan advisers with respect to their individual circumstances and needs.

DOL Revised FMLA Definition of “Spouse”: February 25, 2015

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The Family and Medical Leave Act (FMLA) entitles eligible employees of covered employees of covered Employers to take unpaid, job-protected leave for specified family and medical reasons.  The FMLA also includes certain military family leave provisions.  On February 25, 2015, the U.S. Department of Labor revised Family Medical Leave Act definition of a “spouse.”   The Final Rule’s definition of spouse expressly includes individuals in lawfully recognized same-sex and common law marriages and marriages that were validly entered into outside of the United States if they could have been entered into in at least one state.

 

The DOL noted in its Fact Sheet on the Final Rule that the definitional change means that eligible employees, regardless of where they live, will be able to take:

  • FMLA leave to care for their lawfully married same-sex spouse with serious health conditions,
  • Qualifying emergency leave due to their lawfully married same-sex spouse’s covered military service,
  • Military caregiver leave for their lawfully married same-sex spouse,
  • FMLA leave to care for a stepchild, regardless of whether the in loco parentis (in the place of parents) requirement of providing day-to-day care or financial support for the child is met,
  • FMLA leave to care for a stepparent, who is same-sex spouse of the employee’s parent, regardless of whether the stepparent ever stood in loco parentis to the employee,
  • FMLA leave for their own serious condition, or
  • FMLA leave for the birth of a child or the placement of a child for adoption or foster care and bonding.

 

Action Items for Employers:

Employers that are required to provide FMLA should train and familiarize their Human Resources, Leave Administrators, and Managers/Supervisors with this new rule if they are involved with the leave management process, as benefits available to certain employees may change with the Final Rule.

In addition, we recommend that employers update their FMLA policy in their Employee Handbook, forms, and notices, if they specifically defined “spouse” in any matter, so that the documentation reflects the new changes of the DOL’s definition, which takes effect March 27, 2015.

 

Additional Information on the Final Rule:

 

This content is provided for informational purposes only.  While we have attempted to provide current, accurate and clearly expressed information, this information is provided “as is” and MNJ Insurance Solutions makes no representations or warranties regarding its accuracy  and completeness.  The information provided should not be construed as legal or tax advice or as a recommendation of any kind.  External users should seek professional advice form their own attorneys and tax and benefit plan advisers with respect to their individual circumstances and needs.