COVERAGE END DATES AND PROCEDURES
Advise any employee who is laid off 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 layoff:
When an employee is laid off, agencies must advise the employee of their right to continue group insurance coverage. All persons terminating state service must be given a copy of the COBRA notice at the time of their leaving state service. Advise the employee that coverage (health, dental/vision, life, HCSA, and Long Term Disability) ends at the end of the month following the month the employee ends state service.
Complete the following procedures:
- Complete Insurance Enrollment and Change Form (Form-1) on behalf of the employee. Check termination box 9. For the termination reason, enter “layoff”. For the termination date, enter the last day of work. You are responsible for collecting the employee’s share of GIC premiums through the coverage end date.
- 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.
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.
The employee may continue life insurance coverage under 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.
BENEFIT OPTIONS FOR LAYOFF: Less Than 10 years of STATE Service
Option 1: Keep GIC health and life coverage for 39-weeks.
Benefit: Allows the employee to stay in the same health and life plan with the same group benefit
Drawback: Employee pays 100% of the premium (no Commonwealth contribution). At the end of the 39-weeks, the former employee can switch to COBRA for the remaining 9 months of health coverage, for a total of 18 months coverage. The employee can elect non-group conversion for their life coverage.
Procedure: If the employee elects 39-week coverage, have the employee check the 39-week coverage block on Insurance Enrollment and Change Form (Form-1) and indicate his/her life and health selections and sign it before sending the form to the GIC.
Option 2: Keep GIC health coverage only under COBRA.
Benefit: Allows the employee to stay in the same plan with the same group benefit.
Drawback: Employee pays 100% of the full-cost premium plus 2% for administration (no Commonwealth contribution). Maximum coverage length – 18 months.
Procedure: If the employee elects COBRA, complete the following:
- Check the COBRA block on Insurance Enrollment and Change Form (Form-1).
- Photocopy the Insurance Enrollment and Change Form (Form-1) and file in the employee’s personnel file.
- Send original Insurance Enrollment and Change Form (Form-1) to the GIC.
- Give the employee a COBRA application (available on the GIC’s website). Let the employee know that he/she will also receive a COBRA application at home. 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 return the COBRA application to the GIC.
Option 3: Continue Basic Life and/or Optional Life coverage under portability option.
Benefit: Continue life insurance at a competitive rate.
Drawback: Life insurance only coverage.
Procedure: Let the employee know that the GIC will notify its life insurance carrier that the employee has left state service; 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 4: Commonwealth 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 5: Convert to Non-Group health and/or life coverage with current plan(s).
Benefit: Can keep coverage beyond 18 months.
Drawback: Rates and benefits almost always lower than GIC plan coverage.
- 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.
The GIC will notify its life insurance carrier of the layoff; the carrier will send the employee a conversion package. 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 FOR LAYOFF: TEN or more years STATE service
Instruct the employee to contact their retirement board to confirm retirement eligibility. Employee must be vested and must keep retirement monies in the system. If the employee is under age 55 with ten years, but less than 20 years of state service, or, if the employee is age 55 or over but deferring their retirement pensions, we recommend that the employee elect Deferred Retirement coverage. Under this option, the employee must keep his/her money in the retirement system until he/she retires. When the employee applies for their pension (at retirement) he/she should notify the GIC in order to pick up health coverage. If the employee will not receive health coverage elsewhere, he/she can keep health and life coverage at the full cost premium until retirement.
Deferred Retiree Coverage: Advise the employee that he/she has two health and life options under Deferred Retirement.
- Keep 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: Direct the employee to check the Deferred Retiree block on the Insurance Enrollment and Change Form (Form-1), indicate his/her life selections and sign it before sending the form to the GIC.
- Keep 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 recommends that the employee 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 returning it the GIC.
For the other alternatives, see the benefits, drawbacks, and procedures under Less Than TEN Years of STATE Service.
If the employee has 20 or more years of state service at any age or ten or more years of state service age 55 or over and 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 layoff:
- Complete GIC Offline Payroll Deduction Report Change Form
- Send the GIC Offline Payroll Deduction Report Change Form to the FSA carrier
- File a copy of the form in the employee’s personnel file. Do not send the form to the GIC.
To process a HCSA COBRA application:
- 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 HCSA/DCAP 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.