
Staff Meeting in the Snow
With all of the snowfall last Friday, we decided to have our staff meeting outside and got creative with snow creations!
Many employers mistakenly believe that COBRA is simply billing and collecting premiums from terminated employees. Unfortunately, nothing could be further from the truth. COBRA is one of the most complex and burdensome regulations employers face today. Issues related to COBRA require daily attention. Worse yet, the cost of noncompliance can be extremely high. When employers consider that COBRA is “policed” by divorced spouses and terminated employees, it should become immediately evident why employers should take their COBRA responsibility very seriously.
Contrary to the common myth, true compliance with COBRA requires employers to implement and maintain a three-pronged process. To comply with COBRA, employers must:
(1) Develop, maintain and adhere to formal policies and procedures;
(2) Be able to demonstrate that employees who are responsible for COBRA are well-informed; and,
(3) Administer COBRA properly.
In the best of times, most employers find that just developing a comprehensive COBRA strategy is extremely challenging; while maintaining COBRA compliance is near impossible. That is why so many employers choose outsourcing as part of their COBRA strategy. Unfortunately, outsourcing does not alleviate the employer from their COBRA related responsibilities.
Even if an employer outsources COBRA administration, the employer retains the liability for COBRA compliance. What does this mean? It means the employer still needs to take an active role in COBRA. And it means the employer needs to choose their administrator wisely, and then stay with the administrator to ensure consistency. That is why Advantage Administrators has chosen to partner with Custom Benefit Administrators (CBA) in offering COBRA Administration Services.