COBRA Continuation Coverage

Under the Consolidated Omnibus Budget Reconciliation Act ("COBRA"), "qualified beneficiaries" may extend health benefits on a self-pay basis under certain circumstances called "qualifying events."

Qualified Beneficiaries

A qualified beneficiary means:

• Any individual who, on the day before a qualifying event, is covered under the plan, either as a spouse or as a dependent child of a retiree. A domestic partner or the child of a domestic partner is not a qualified beneficiary and therefore is not entitled to COBRA Continuation Coverage following a qualifying event.
• A child who is born to, adopted by, or placed for adoption with a retiree (as opposed to another family member) during COBRA, provided the child is enrolled by submitting an enrollment form and a copy of the birth certificate or adoption papers to the plan administrator within 60 days of birth, adoption, or placement for adoption, and the appropriate self-payments are made. The child will have the same COBRA rights as a dependent who was covered by the plan before the qualifying event that resulted in the loss of coverage.

Other dependents of a qualified beneficiary who are newly acquired during a period of COBRA may be enrolled in COBRA by submitting an enrollment form along with the appropriate certificates to the plan administrator within 60 days of becoming a dependent. However, such dependents will not be considered qualified beneficiaries.

An individual ceases to be a qualified beneficiary if COBRA is not timely elected, or when the plan's obligation to provide COBRA otherwise ends.

36-Month Qualifying Events

A spouse or dependent child may elect COBRA for a maximum of 36 months following the date coverage would otherwise end due to one of the following qualifying events:

• Death of the retiree;
• Divorce or legal separation between the retiree and spouse;
• The dependent child ceases to meet the plan's definition of "dependent."

Notice Requirements

The plan offers COBRA only after it has been notified of a qualifying event. A qualified beneficiary is responsible for notifying the plan administrator of a qualifying event that is a divorce, legal separation, or child losing dependent status. The qualified beneficiary must provide this notice to the plan administrator in writing within 60 days of the later of the date of the qualifying event; the date coverage would be terminated as a result of the qualifying event; or the date this booklet or other notice is provided of the procedure for electing COBRA. The notice must identify the individual who has experienced a qualifying event, the retiree's name, and the qualifying event which occurred. If the plan administrator is not notified during the 60-day period, the qualified beneficiary will lose the right to elect COBRA.

If a child is born to, adopted by, or placed for adoption with a qualified beneficiary during a period of COBRA, you must notify the plan administrator in writing within 60 days of the birth, adoption or placement for adoption, and provide a copy of the child's birth certificate or adoption papers. If the plan administrator is not notified, the child will lose the right to receive COBRA.

A qualified beneficiary who first becomes, after the date of the election of COBRA, covered under any other group health plan, must notify the plan administrator in writing of the other coverage.

Election of COBRA

When the plan administrator is notified of a qualifying event, an election form is mailed to the qualified beneficiaries. The election form must be completed and returned to the plan administrator within 60 days of the later of the termination of coverage, or the date the application was sent. If the election form is not sent to the plan administrator by this date, the qualified beneficiaries will lose the right to elect COBRA.

Each qualified beneficiary has an independent right to elect COBRA. A spouse may elect COBRA on behalf of other qualified beneficiaries in the family. A parent or legal guardian may elect COBRA on behalf of a minor child.

Type of Benefits

Under COBRA, a qualified beneficiary may continue medical and prescription drug coverage, provided the qualified beneficiary was eligible for such benefits immediately prior to the qualifying event. Life insurance benefits are not available under COBRA.

COBRA also allows a qualified beneficiary to continue eligibility in the Retiree Health Reimbursement Account, provided the qualified beneficiary was eligible for such coverage immediately prior to the qualifying event. However, following a qualifying event, the Retiree Health Reimbursement Account may only be used to pay the cost of continuing medical and prescription drug coverage through COBRA. Since the cost of maintaining the Retiree Health Reimbursement Account through COBRA would be the same as paying directly to continue medical and prescription drug coverage through COBRA, there is no advantage to maintaining the Retiree Health Reimbursement Account.

Cost and Payment

There is a cost for COBRA. Information regarding the cost will be sent with the election forms. The first payment is due 45 days from the date the election form is sent to the plan administrator. The first payment must cover all months since the date coverage would have otherwise terminated. Thereafter, payments must be made monthly to continue COBRA. All payments must be sent to the plan administrator.

COBRA eligibility will not commence, nor will claims be processed for expenses incurred following the date of the qualifying event, until the appropriate COBRA payments have been made. COBRA terminates if a monthly payment is made later than 30 days from the beginning of the month to be covered. If the initial payment, or any subsequent payment is not made in a timely fashion, COBRA terminates.

Termination of COBRA Continuation Coverage

COBRA Continuation Coverage will end on the first of the dates below:

1. The last day of the month the maximum coverage period for the qualifying event has ended (36 months).
2. The last date for which payments were paid, when the qualified beneficiary (spouse or dependent child) does not make the next payment in full when due or by the end of the grace period set by COBRA.
3. If a qualified beneficiary (spouse or dependent child) has added family members to his or her COBRA Continuation Coverage, coverage for those family members ends on the date that the qualified beneficiary's coverage ends.
4. The date the Employee Health Plan or the Retiree Health Plan is terminated by the Board of Trustees.

COBRA Continuation Coverage is provided subject to eligibility. The plan reserves the right to terminate COBRA Continuation Coverage retroactively if the qualified beneficiary is determined to be ineligible for coverage.

Notices

Notices and self-payments that are required for COBRA must be sent in writing to the plan administrator at the following address:

Enrollment/Eligibility Department
Carpenters Health and Security Trust of
Western Washington
PO Box 1929
Seattle, WA 98111-1929

If you have any questions about continuation coverage, please contact the plan administrator.

If You Have Questions

Questions concerning your plan or your COBRA Continuation Coverage rights should be addressed to the contact or contacts identified below. For more information about your rights under ERISA, including COBRA, the Health Insurance Portability and Accountability Act (HIPAA), and other laws affecting group health plans, contact the nearest Regional or District Office of the U.S. Department of Labor's Employee Benefits Security Administration (EBSA) in your area or visit the EBSA website at www.dol.gov/ebsa. (Addresses and phone numbers of Regional and District EBSA Offices are available through EBSA's website.)

Keep Your Plan Informed of Address Changes

In order to protect your family's rights, you should keep the plan administrator informed of any changes in the addresses of family members. You should also keep a copy, for your records, of any notices you send to the plan administrator.

Plan Contact Information

Enrollment/Eligibility Department
Carpenters Health and Security Trust of Western Washington
PO Box 1929
Seattle, WA 98111-1929
(206) 441-6514 Seattle Area
(800) 552-0635 Nationwide