COVERAGE END DATES AND PROCEDURES
Advise any employee leaving state service of the following GIC coverage end dates:
Date employment ends GIC coverage end date
January 1-31 February 28
February 1-29 March 31
March 1-31 April 30
April 1-30 May 31
May 1-31 June 30
June 1-30 July 31
July 1-31 August 31
August 1-31 September 30
September 1-30 October 31
October 1-31 November 30
November 1-30 December 31
December 1-31 January 31
You are responsible for collecting the employee’s share of GIC premiums through the coverage end date.
To process a termination from state service:
All persons leaving state service must be given a copy of the COBRA Notice at the time of their leaving state service.
All agencies must advise employees leaving state service of their right to continue group insurance coverage. When an employee advises you that he or she is leaving state service:
- Advise the employee that his/her coverage (health, dental/vision, life and Long Term Disability) ends at the end of the month following the month the employee ends state service. You are responsible for collecting the employee’s share of GIC premiums through the coverage end date.
- Complete Insurance Enrollment and Change Form (Form-1) on behalf of the employee. Check termination box 9. For the termination reason, enter “leaving state service”. For the termination date, enter the last day of work (excluding vacation time).
- Photocopy the completed Insurance Enrollment and Change Form (Form-1) and file it in the employee’s personnel file.
- Send the original Insurance Enrollment and Change Form (Form-1) to the GIC.
- Enter the termination information in the HR/CMS or UMASS payroll system. The GIC interface will automatically update the MAGIC system with the termination information.
The employee may continue life insurance coverage at the same group rate under the portability option, unless he or she is retiring. The GIC’s life insurance carrier will contact employees leaving state service directly with this information.
The employee’s health options depend on his or her length of state service. See the corresponding options and procedures below. Options are listed in order of recommended selection.
BENEFIT OPTIONS: NOT ELIGIBILE FOR RETIREMENT
Option 1: Keep GIC health coverage only under COBRA.
Benefit: Allows the employee to stay in the same plan with the same group rate.
Drawbacks: Employee pays 100% of the premium plus 2% for administration (no Commonwealth contribution). Maximum coverage length – 18 months.
Procedure: If the employee elects COBRA, check the COBRA block on Insurance Enrollment and Change Form (Form-1) before sending it to the GIC. Give the employee a COBRA application (available on the GIC’s website.) Advise the employee that although he/she has 60 days to elect COBRA coverage, the coverage is effective the first day of the month following the coverage end date. The longer the employee waits to send in the application, the more he/she will owe in retroactive premiums.
Instruct the employee to complete and send the COBRA application directly to the GIC.
Option 2: Continue basic life and/or optional life coverage under portability option.
Procedure: Let the employee know that the GIC will advise its life insurance carrier that the employee has left state service and that the life insurance carrier will send portability information and an application in the mail to the employee’s home. Time limits apply. See the Life Insurance booklet on the Basic and Optional Life Insurance Overview section of the website (www.mass.gov/gic/life) for details.
Option 3: Health Connector coverage for Massachusetts residents.
Benefit: A choice of health insurance options with different benefits and prices. Depending on which plan you choose, your monthly premium with the Health Connector could be lower than other coverage options. Unlike COBRA coverage, Health Connector coverage does not have a maximum coverage period; you can continue coverage as long as you pay your premiums on time.
Drawback: Benefits may not be the same as the coverage you had through the GIC. If the employee enrolls in Health Connector coverage, he/she is waiving his/her right to elect health insurance under the GIC’s COBRA or conversion options.
Procedure: Instruct the employee to contact the Health Connector for information and enrollment: MAhealthconnector.org; 1-877-623-6765
Option 4: Convert to Non-Group health with current plan(s).
Benefit: Can keep coverage beyond 18 months.
Drawback: Benefits almost always less comprehensive than GIC plan coverage.
Procedure: Check non-group conversion on Insurance Enrollment and Change Form (Form-1) before sending it to the GIC. Instruct the employee to contact their health plan for a non-group conversion application, benefit changes, procedures and costs.
Option 5: Convert to Non-Group life insurance with current plan.
Benefit: Ability to continue life insurance coverage.
Drawback: Rates and benefits almost always lower than GIC plan coverage.
Procedure: Let the employee know that the GIC will notify its life insurance carrier that the employee has left state service; the carrier will mail a conversion package to the employee’s home. Time limits apply. See the Life Insurance booklet on the Basic and Optional Life Insurance Overview section of the website (www.mass.gov/gic/life) for details.
BENEFIT OPTIONS: DEFERRED RETIREMENT
Instruct the employee to contact their retirement board to confirm retirement eligibility.
If the employee is vested but not yet eligibile for, or chooses not to collect their monthly pension, we recommend that the employee elect Deferred Retirement. Under this option, the employee must keep his/her money in the retirement system until he/she retires. If the employee will not receive health coverage elsewhere, he or she can elect to keep basic life and health coverage at the full cost premium until retirement. When the employee applies for their pension (at retirement) he or she should notify the GIC in order to pick up basic life and health coverage.
Deferred Retirement Coverage:
Advise the employee that he/she has two health and life options under Deferred Retirement:
- Keep basic life insurance, paying 100% of the premium as a deferred retiree. Get health coverage elsewhere until retirement. Resume GIC health coverage at retirement. At retirement, the Commonwealth will contribute the prevailing contribution percentage for retirees.
Procedure: Instruct the employee to check the deferred retirement block on the Insurance Enrollment and Change Form (Form-1), checking basic life insurance and signing it before sending it to the GIC.
- Keep basic life and health insurance paying 100% of the premium until retirement. Advise the employee that if he or she gets coverage elsewhere before retirement, he/she may cancel health coverage, but the GIC suggest that the employee continue to keep basic life insurance.
Procedure: Instruct the employee to check the deferred retiree block on Insurance Enrollment and Change Form (Form-1), indicate his/her life and health selection and sign it before sending it to the GIC.
For the other alternatives, see the benefits, drawbacks, and procedures for NOT ELIGIBLE FOR RETIREMENT.
If the employee wishes to retire and collect a monthly pension, see the RETIREMENT section for procedures.
FLEXIBLE SPENDING ACCOUNTS (HCSA AND DCAP)
If an employee leaves state service during the Plan Year whether he/she resigns, retires or involuntarily separates, participation in HCSA and DCAP will terminate as of midnight the day of termination. The employee will be able to submit claims for eligible health care expenses incurred on or before the last day of active employment. In order for the employee to use the HCSA account after terminating state service, the employee may elect to contribute to the HCSA account under COBRA by making direct payments on an after-tax basis.
DCAP: The employee may file claims for eligible dependent care expenses against the account balance until the account is exhausted. They will not be reimbursed in excess of what they have contributed to the plan at that time. Claims can be filed with dates of service through the end of the Plan Year.
The FSA carrier must receive all completed claims by April 15.
To Process a Termination of State Service for an Employee with Flexible Spending Account Benefits:
- Inactivate the HCSA/DCAP and pre-tax fee amount deductions in HR/CMS or the UMASS payroll system.
- HCSA/COBRA: Give the employee the Health Care Spending Account Continuation Coverage Under COBRA General Notice and Election Form and the COBRA Acknowledgement Form for you and the employee to sign and date.
- File the COBRA Acknowledgement Form in the employee’s personnel file. Do not send the form to the GIC or the FSA carrier.
- The employee must send the Election Form to the FSA carrier within 60 calendar days from the date of their COBRA Notice.
- The FSA carrier will determine eligibility and notify the employee either by mail or email.
- The FSA carrier will provide COBRA payment information. The amount to the employee will include a 2% administrative fee.
This information provided by the Group Insurance Commission .