School board looks for help with federal insurance law

CENTERVILLE –– The St. Mary Parish School Board decided to outsource administrative Consolidated Omnibus Budget Reconciliation Act services Thursday after discovering the district hasn’t been complying with the act.
COBRA can provide employees and family members continued health benefits coverage under their group health plan for 18 months after leaving a job. Qualified individuals may be required to pay the entire premium coverage up to 102 percent of the plan’s cost, according to the U.S. Department of Labor’s website.
COBRA requires employers to send a notice to all people covered in the insurance plan options to elect continued coverage. An employer has 30 days to issue COBRA coverage.
There are no employer contributions.
“It’s a very detailed and cumbersome process,” said James Perez, St. Mary Parish School Board group health insurance consultant. “I am compelled to recommend to the board that you bring in contracting with a third party to administrate COBRA.”
Perez negotiated a rate of 55 cents per employee from a prospective firm. The estimated number of employees covered by group health plans is 820.
The approximate monthly cost for the firm’s service is $500, which is paid by the school board.
Board member Marilyn LaSalle, District 6, referred to the Patient Protection and Affordable Care Act, known as Obamacare, as an alternative for employees instead of COBRA.
“COBRA is no way near affordable,” LaSalle said.
Perez said the law requires the board to offer continued coverage through COBRA or suffer the consequences later. It is required by the Department of Labor.
The school board can be sued if a former employee incurred expenses two years after employment because of illness or accident and COBRA coverage was not offered, Perez said.
“I don’t think that in every aspect the requirements are being followed,” Perez said. “I think it is a huge risk for a group this size to self-administer COBRA.”
After board members sought advice from Chief Financial Officer Alton Perry, they approved a third-party firm to administer COBRA services.
The administrative COBRA services effective target date is Nov. 1.

This story was written by Shea Drake of The Daily Review staff. Reach her at sdrake@daily-review.com.