Q: What is the deal with COBRA coverage? Why do we always get stuck waiting while a patient fights it out with their old employer? — Kerry
A: Hi, Kerry — I feel your frustration with COBRA and you are certainly not alone. Let me start with how COBRA works for dental coverage and why administrative team members should know how to handle it in their office. The Consolidated Omnibus Budget Reconciliation Act (COBRA) was created to allow employees to continue their health benefits after a change in employment status. Anyone who reads the news knows that layoffs are happening with regularity and even increasing in certain areas of the country. For those employees who were covered under an employer’s dental plan, they can elect to continue coverage for 18 months for layoffs, reduction in hours, and termination (except for gross misconduct reasons). In cases of divorce, separation, annulment, employee death, or the aging out of dependent children, coverage can be extended to 36 months. For employees with disabilities, the term can be up to 29 months. As you can see, it can be complicated.
However, COBRA coverage can cost more than the employee or family can afford. When an employee has a life change such a job loss, many are shocked by how much COBRA coverage costs. Many employees are shielded by the true cost of insurance because the employer has picked up the majority of the expense. Employees need to cover the full price of the premium plus up to 2% in administrative fees. Their coverage will then continue until they either terminate it or it runs out.
The impact on the dental office is that the employee’s coverage is usually listed as terminated because there is a time gap between the company accepting the monthly payment from the employee and the notification to the insurance company. If the patient waits until the last minute every month to pay the premium, then the coverage dates will not be updated until the check clears. We hear it at the desk from patients, “But I do have coverage; it’s COBRA. Can’t you just hold the claim and submit it tomorrow?” This means we have to either trust the patient or ask for the human resource (HR) contact so the coverage can be verified. The insurance company will not be any help if the patient shows as inactive. They’ll simply refer you to the employer’s HR department.
I would advise being kind but firm about this with a patient. There are definitely times when it is the HR department’s fault for taking so long to notify the carrier, but the dental office does not have the time to figure out who is at fault. We just want to know if the claim will go through. I would allow for this to happen only once. Tell the patient that this time you’ll hold it but you cannot do so next time.
“Mrs. Ritz, I know COBRA can be confusing. I can hold onto this claim and submit it tomorrow when your coverage is active again. Let’s schedule your next appointment for the middle of the month so we know for sure that this gap in coverage won’t happen again. In the past we’ve seen this gap happen when the premiums are paid monthly close to the due date. If you have the option to prepay your premium, it will help you avoid this. I’m sure it’s affecting your health insurance the same way.”
Communicate this in a friendly way so that patients can see you are helping them to understand their benefits rather than making them feel that it is just another roadblock in an already difficult road.
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Author Bio: Teresa Duncan, MS, FADIA, FAADOM, is an international speaker who addresses topics such as insurance coding, office manager training, and revenue growth. Her company Odyssey Management, Inc. provides virtual, customized training in these areas. She can be reached at [email protected].
Editor's Note: The dental procedures codes ("Code") are owned and published by the American Dental Association ("ADA") in its reference manual Current Dental Terminology ("CDT"). The ADA is the exclusive owner and copyright holder of the CDT, including the Code, as well as of the ADA claim form.