Continuing legislative changes are making COBRA harder to administer, not easier. New Mexico is one of many states where employers must not only comply with the federal Consolidated Omnibus Budget Reconciliation Act (COBRA), requiring continuation of coverage for employee benefits, but also with state COBRA continuation of coverage laws.
This article will guide employers through New Mexico COBRA laws and how to manage compliance.
COBRA ensures that employees and their families still have access to employer-provided healthcare benefits for a limited period of time under specific circumstances and life-changing events.
The general purpose behind state-specific COBRA laws is so that employees of smaller businesses that are not covered by federal COBRA are still guaranteed continuation of coverage. Although, some states do have expanded timelines or requirements for continued coverage.
With the right benefits partner, employers can spend time managing employees, not administering COBRA. Additionally, a benefits partner can help manage initial benefits eligibility, open enrollment, and ongoing benefits changes properly.
Federal COBRA continuation of coverage requirements apply to private-sector employers who maintain group healthcare plans with 20 or more employees.
Under New Mexico's continuation of coverage law, all employees that work for an employer that offers a health insurance policy providing hospital, surgical, and medical expense benefits are covered and guaranteed continuation of coverage for themselves and covered family members when they would otherwise lose group health insurance coverage due to certain specified events.
Coverage can last up to three years unless group health insurance was lost due to termination of employment or a reduction in hours. In that case, the required continuation coverage period is 18 months.
Employees in the state of New Mexico have the right to continuation of coverage as a result of losing coverage due to the following events:
In the case of a dependent child of a covered employee, the right to continuation of coverage is granted due to loss of coverage due to the following events:
The right to continuation of coverage does not apply if coverage terminates for:
Additionally, the right to continuation of coverage by an employee or covered family member who is eligible for Medicare is limited to coverage under a Medicare supplement insurance policy.
Insurers are required to notify employees in writing of the availability of continuation coverage when a qualifying event occurs. Alternatively, the employer may give this written notice.
Employees and / or family members have 60 days to then elect for continuation of coverage.
The eligible employee or covered family member exercising the right to continue coverage must notify the employer or insurer and make payment of the applicable insurance premium within 30 days following notice of the availability of continuation coverage by the insurer (or the employer).
COBRA and continuation of coverage is an important area of labor law compliance, particularly in states with state-specific COBRA laws. And while compliance is tough enough as it is, continuing legislative changes are making COBRA even harder to administer, not easier.
With the right benefits partner and solution, you can spend your time managing your workforce, not administering COBRA. Other benefits of managing COBRA compliance with the help of a benefits provider include:
So, employers in New Mexico who are struggling with COBRA management and continuation of coverage compliance may want to consider reaching out to a New Mexico Insurance Broker or HR consultant for help.
To get connected with a provider in New Mexico, contact us today.