COBRA Law Summaries
Kansas, COBRA Law Summaries
Kansas' health care continuation law is codified in the Kansas Statutes Annotated at Chapter 40, Section 40-2209.
DEFINITIONS
“Employees” may include the proprietor, or officers and managers, or partners, as well as the employees and retired employees of the employer (Sec. 40-2209(F), as amended by H. 2088, L. 1999, effective July 1, 1999).
“Group sickness and accident insurance” is that form of sickness and accident insurance covering groups of persons, with or without one or more members of their families or one or more dependents (Sec. 40-2209(A), as amended by H. 2088, L. 1999, effective July 1, 1999).
COVERAGE
Kansas' health care continuation law covers employers maintaining group health policies; however, this does not apply to a group policy subject to the requirements of COBRA (Sec. 40-2209(A), as amended by H. 2088, L. 1999, effective July 1, 1999).
Nonprofit hospitals and hospital service companies must also provide conversion coverage to covered enrollees and their dependents who have been continuously covered under the group policy for at least three months prior to termination of coverage (Secs. 40-1805 and 40-1905, as amended by H. 2104, L. 1997; and Sec. 40-3209, as amended by S. 204, L. 1997).
PROCEDURES
An employee or member, and his or her eligible dependents, who have been continuously insured under the group policy for at least three months immediately prior to termination of the group coverage, are eligible. The surviving or divorced spouse of an employee or member is also eligible. No continuation coverage is available if (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999):
the group policy terminated for failure to pay the premium;
the employee or member is eligible for Medicare; or
the employee or member is eligible for other group coverage.
WHAT THE EMPLOYER MUST DO
An employer must offer continuation coverage to an employee or member, a surviving or divorced spouse of an employee or member, and eligible dependents of an employee or member (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
Eligibility requirements.- An employee or member, and his or her eligible dependents, who have been continuously insured under the group policy for at least three months immediately prior to termination of the group coverage, are eligible. The surviving or divorced spouse of an employee or member is also eligible. Converted coverage need not be issued to a person eligible for Medicare or for other insurance that, taken together with the converted coverage, would result in overinsurance (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
Extended election period for individuals eligible for ARRA subsidy. Individuals otherwise eligible for the federal premium subsidy have an extended period in which to elect coverage under Kansas’s law. An individual who qualifies as an assistance eligible individual on or after March 1, 2009, under the American Recovery and Reinvestment Act of 2009 may elect special assisted continuation of coverage as provided in ARRA, including individuals who do not have continuation of coverage in effect on March 1, 2009. The employer of the terminated employee shall provide the additional notice of the right to elect coverage pursuant to this section as required by ARRA, and election as required by ARRA shall be made by an assistance eligible individual to the insurer. Special assisted continuation of coverage will begin with the first period of assisted continuation of coverage beginning on or after February 17, 2009, and shall extend for the period of special assisted continuation of coverage allowed by ARRA. As under federal law, nine months of subsidized coverage is available. The subsidy provisions expire on January 1, 2011 (KS H 2052, enacted 4/13/2009; effective upon publication in Kansas register).
Conversion to individual policy.- An employee or member and his or her dependents who have been continuously covered under the group policy for at least three months prior to termination of the group coverage are generally eligible for conversion coverage. The surviving or divorced spouse of an employee or member is also eligible. Converted coverage need not be issued to a person eligible for Medicare or for other insurance, that taken together with the converted coverage, would result in overinsurance (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
Nonprofit hospitals and hospital service companies must also provide conversion coverage to covered enrollees and their dependents who have been continuously covered under the group policy for at least three months prior to termination of coverage (Secs. 40-1805 and 40-1905, as amended by H. 2104, L. 1997; and Sec. 40-3209, as amended by S. 204, L. 1997).
Notice.- A notification of the conversion privilege must be included in each certificate of coverage. Also, the insurer must give the employee or member, and his or her covered dependents, reasonable notice of the right to convert the group coverage at least once during the 18-month continuation period. For employees covered by COBRA, the conversion notice must be given at least 30 days prior to the end of the COBRA continuation period or 30 days prior to the date the employer ceases to provide any similar group health plan to the employee (Sec. 40-2209, as amended by Ch. 164 (S. 81), L. 2007, enacted June 9, 2008, effective July 1, 2008).
Deadlines.- Written application for the converted policy must be made and the first premium paid to the insurer not later than 31 days after group coverage terminates. Where an employee is covered by COBRA and the employer ceases to provide any similar group health plan to any employee, then written application for the converted policy must be made and the first premium must be paid to the insurer not later than 31 days after the conversion notice is received by the employee (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
Premium.- The premium charged for conversion coverage must be one that can be expected to produce an anticipated loss ratio of not less than 80% based upon conversion, morbidity and reasonable assumptions for expected trends in medical care costs. In the event the group policy is terminated and is not replaced, converted policies may be issued at self-sustaining rates that are not unreasonable in relation to the coverage provided based on conversion, morbidity and reasonable assumptions for expected trends in medical care costs (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
Termination of coverage.- The insurer may refuse to renew coverage with respect to a person if (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999):
together with other sources of benefits, providing converted coverage would result in overinsurance;
fraud or material misrepresentation occurred in applying for benefits; or
other reasons approved by the Commissioner of Insurance.
An insurer may not refuse to renew coverage on the basis that the person is eligible for Medicare (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
Duration of coverage: Continuation coverage.- Coverage lasts for 18 months from the date group coverage terminated (Sec. 40-2209, as amended by Ch. 164 (S. 81), L. 2007, enacted June 9, 2008, effective July 1, 2008).
Premiums: continuation coverage.- The premium charged for continuation coverage must be the same as that applicable to members or employees remaining in the group and is payable to the employer (Sec. 40-2209, as amended by Ch. 164 (S. 81), L. 2007, enacted June 9, 2008, effective July 1, 2008).
Premiums: conversion coverage.- The premium charged for conversion coverage must be one that can be expected to produce an anticipated loss ratio of not less than 80% based upon conversion, morbidity and reasonable assumptions for expected trends in medical care costs. In the event the group policy is terminated and is not replaced, converted policies may be issued at self-sustaining rates that are not unreasonable in relation to the coverage provided based on conversion, morbidity and reasonable assumptions for expected trends in medical care costs (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
Termination of coverage.- Kansas' health care continuation law is silent as to events that will terminate continuation coverage. However, with regard to conversion coverage, the insurer may refuse to renew coverage with respect to a person if (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999):
together with other sources of benefits, providing converted coverage would result in overinsurance;
fraud or material misrepresentation occurred in applying for benefits; or
the person is eligible for Medicare.
NOTICE
Continuation coverage.- The employer must provide the employee and any covered dependents with reasonable notice of the right to continuation coverage (Sec. 40-2209, as amended by Ch. 164 (S. 81), L. 2007, enacted June 9, 2008, and effective July 1, 2008).
Conversion coverage.- A notification of the conversion privilege must be included in each certificate of coverage. Also, the insurer must give the employee or member, and his or her covered dependents, reasonable notice of the right to convert the group coverage at least once during the 18-month continuation period. For employees covered by COBRA, the conversion notice must be given at least 30 days prior to the end of the COBRA continuation period or 30 days prior to the date the employer ceases to provide any similar group health plan to the employee (Sec. 40-2209, as amended by Ch. 164 (S. 81), L. 2007, effective July 1, 2008).
DEADLINES
Conversion coverage.- Written application for the converted policy must be made and the first premium paid to the insurer not later than 31 days after group coverage terminates. Where an employee is covered by COBRA and the employer ceases to provided any similar group health plan to any employee, then written application for the covered policy must be made and the first premium must be paid to the insurer not later than 31 days after the conversion notice is received by the employee (Sec. 40-2209, as amended by H. 2088, L. 1999, effective July 1, 1999).
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