Health Care Continuation Coverage

SUMMARY: This document is a request for information to assist the

Department of Labor (the Department) in assessing the need for a

regulation clarifying certain statutory notice requirements set forth

in section 606 of Title I of the Employee Retirement Income Security

Act (ERISA) and in section 4980B of the Internal Revenue Code (the

Code). These statutory notice requirements were enacted as part of the

continuation coverage provisions included in the Consolidated Omnibus

Budget Reconciliation Act of 1985 (COBRA). The continuation coverage

provisions, commonly referred to as the COBRA provisions, generally

require group health plans to provide participants and beneficiaries

who under certain circumstances would otherwise lose coverage

(qualified beneficiaries) with the opportunity to elect to continue

coverage under the plan at group rates for a limited period of time.

The Department anticipates that information and views provided by

plan sponsors, plan fiduciaries, service providers to plans, plan

participants and beneficiaries, and other interested persons will aid

it in assessing the need for issuing a regulation to explicate the

notice requirements of the COBRA provisions and the appropriate scope

and content of any such regulation. A regulation on the notice

requirements of the COBRA provisions would affect participants and

beneficiaries (including qualified beneficiaries) of certain group

health plans, as well as the sponsors and fiduciaries of such plans.

DATES: Written comments should be received by the Department of Labor

on or before November 24, 1997.

ADDRESSES: Comments (preferably, at least six copies) should be

addressed to the Office of Regulations and Interpretations, Pension and

Welfare Benefits Administration, Room N-5669, U.S. Department of Labor,

200 Constitution Ave., NW, Washington, DC 20210. Attn: COBRA RFI. All

comments received will be available for public inspection at the Public

Disclosure Room, Pension and Welfare Benefits Administration, U.S.

Department of Labor, Room N-5507, 200 Constitution Ave., NW,

Washington, DC 20210.

FOR FURTHER INFORMATION CONTACT: David Lurie, Office of Regulations and

Interpretations, Pension and Welfare Benefits Administration, (202)

219-7461. This is not a toll-free number.

SUPPLEMENTARY INFORMATION:

A. Background

1. The COBRA Provisions

The COBRA provisions, sections 601 to 608 of Title I of ERISA, and

the related portions of section 4980B of the Code,1

establish the requirement that any ``group health plan'' 2

maintained by an employer that employs 20 or more employees must offer

``qualified beneficiaries'' 3 the opportunity to elect

``continuation coverage'' under the plan following certain events

(qualifying events) that would otherwise result in the loss of

coverage.4

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\1\ All references herein to ERISA sections 601-608 should be

read to refer also to corresponding provisions in Code section

4980B.

\2\ The term group health plan is defined in section 607(1) to

mean an employee welfare benefit plan providing medical care (as

defined in section 213(d) of the Code) to participants or

beneficiaries directly or through insurance, reimbursement, or

otherwise. Plans that provide substantially only long-term care

services (as defined in section 7702B(c) of the Code, however, are

not included. Further, although governmental plans are excepted from

coverage under Title I of ERISA, see ERISA section 4(b)(1), COBRA

amended the Public Health Service Act, 42 U.S.C. Sec. 300bb-1 et

seq., to impose requirements for the provision of health care

continuation coverage similar to those contained in Part 6 of Title

I on certain State and local employers.

\3\ Section 607(3) defines qualified beneficiary generally as

any person, other than a covered employee, who, on the day before

the qualifying event for that employee, was a beneficiary under the

plan as the spouse or dependent child of the covered employee. In

the case of a qualifying event that is the termination or reduction

of hours of the covered employee, the term also includes the covered

employee. In the case of a qualifying event that is the bankruptcy

of the plan sponsor, the term qualified beneficiary includes the

covered employee if he or she had retired on or before the date of

substantial elimination of coverage, and any individual who, on the

day before the qualifying event, was a beneficiary under the plan as

the surviving spouse of the covered employee. The Health Insurance

Portability and Accountability Act of 1996 (HIPAA) expanded the

definition of qualified beneficiary contained in section 607(3) to

include children who are born to or placed for adoption with the

covered employee during the duration of continuation coverage.

\4\ Section 603 defines a qualifying event as any of the

following: 1) the death of the covered employee; 2) the termination

(other than by reason of gross misconduct) or reduction in hours of

the covered employee's employment; 3) the divorce or legal

separation of the covered employee from the employee's spouse; 4)

the covered employee's becoming entitled to benefits under Medicare;

5) a dependent child's ceasing to be a dependent under the terms of

the plan; or 6) the bankruptcy of the employer from which the

covered employee retired. Section 607 defines other relevant terms,

such as ``covered employee'' and ``group health plan,'' for the

purposes of the COBRA provisions.

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Under section 602(2)(A), the nature of the qualifying event

determines the length of continuation coverage that an employer must

make available to a qualified beneficiary. If the qualifying event is

either a termination or a reduction in the hours of the covered

employee's employment, the period of continuation coverage is up to 18

months from the date of the qualifying event.5 This period

is extended for an additional 11 months, to make a total period of 29

months of continuation coverage, for all qualified beneficiaries with

respect to a covered employee, if any of such qualified beneficiaries

has been determined, pursuant to Title II or Title XVI of the Social

Security Act, to have been disabled at any time within the first 60

days of continuation coverage.6 Furthermore, in cases

involving a termination or reduction of hours of employment, the

occurrence of another qualifying event during the initial 18 months of

continuation coverage will extend the continuation coverage period to

up to 36 months from the date of the original qualifying event. In all

other cases, the period of continuation coverage is generally up to 36

months from the date of the qualifying event. The occurrence of certain

events subsequent to election of continuation coverage can cause the

period of continuation coverage to end prior to the end of the

otherwise applicable continuation coverage period.7

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\5\ A group health plan may, pursuant to section 607(5), provide

instead that the period of continuation coverage (and the period

during which the employer must notify the plan administrator of a

qualifying event) will begin on the date the qualified beneficiary

loses coverage, rather than the date of the qualifying event.

\6\ Prior to enactment of HIPAA, section 602(2) provided that a

qualified beneficiary would be entitled to the 11-month disability

extension only if he or she was disabled at the time that the

covered employee suffered the termination or reduction in hours of

employment. HIPAA also amended section 602(2) to clarify that the

11-month disability extension applies to the non-disabled family

members of a disabled qualified beneficiary who meets the

requirements for the extension, provided those family members are

also entitled to continuation coverage.

\7\ For example, a qualified beneficiary's right to continuation

coverage will cease if an employer ceases to provide group health

coverage to its employees, if the qualified beneficiary fails to pay

required premiums in a timely fashion, or if the qualified

beneficiary becomes covered under another group health plan that

does not contain any invalidating pre-existing condition exclusions

or limitations. See Sec. 602(2) (B), (C), (D).

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The COBRA provisions specify the nature of the continuation

coverage that must be offered, the premiums that a qualified

beneficiary may be required to pay as a predicate for such continuation

coverage, and the manner in which plan administrators must provide

qualified

[[Page 49895]]

beneficiaries with the opportunity to elect continuation coverage and

to pay any required premiums. See sections 602, 604, 605.

Section 606 establishes a series of related notice requirements

that ultimately trigger, under section 605, the beginning of the period

of time during which the qualified beneficiary may elect continuation

coverage (the election period). These notice requirements are described

in detail in Section 2, below.

Section 608 grants the Secretary of Labor generally the authority

to issue regulations to carry out the provisions of Part 6 of Title I

of ERISA. In order to avoid duplicate and perhaps inconsistent

regulations, the Conference Report accompanying COBRA 8

provides that the Secretary of Labor is authorized to promulgate

regulations implementing the disclosure and reporting requirements of

COBRA, while the Secretary of the Treasury is authorized to issue

regulations defining the required continuation coverage.9

The Conference Report further stated that pending the promulgation of

regulations, employers would be required to operate ``in good faith

compliance with a reasonable interpretation of the substantive rules

and notice requirements' H. Rep. 99-453 at 562-63.

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\8\ H. Rep. No. 99-453, 99th Cong., 1st Sess. (December 18,

1995).

\9\ The Conference Report indicates further that the Secretary

of Health and Human Services, who is to issue regulations

implementing the continuation coverage requirements for State and

local governments, must conform the actual requirements of those

regulations to the regulations issued by the Secretaries of Labor

and the Treasury. Id. at 562-63. Pursuant to its authority, the

Treasury Department has proposed certain regulations relating to

continuation coverage. See Prop. Treas. Reg. Sec. 1.162-26 (52 Fed.

Reg. 22716, June 15, 1987).

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2. COBRA Notices

Section 606 of ERISA provides for a series of related notices,

beginning with the requirement for a general notice of the rights

provided under COBRA and culminating with an individualized notice to a

qualified beneficiary entitled to elect continuation coverage.

(a) Initial Notice. Section 606(a)(1) requires a group health plan

to provide to each covered employee and spouse of the employee (if any)

at the time of commencement of coverage under the plan 10 a

written notice describing the rights provided under COBRA.11

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\10\ Advisory Opinion 94-17 (April 9, 1994) states that a group

health plan is required to provide the initial notice required by

section 606(a)(1) only to individuals who may at some time become

entitled to elect continuation coverage under the plan, i.e.,

someone who is or becomes covered under the plan. Accordingly, a

group health plan is required to provide the initial notice to a

covered employee's spouse only if, and at the time, the spouse

commences coverage under the plan.

\11\ On June 26, 1986, the Department issued ERISA Technical

Release 86-2 (TR 86-2), ``Guidance on Group Health Continuation

Coverage Notification Provisions,'' to provide for use by employers

a model initial notice satisfying the requirements of section

606(a)(1). TR 86-2 emphasizes that use of the model notice is not

the only method of achieving good faith compliance with a reasonable

interpretation of the initial notice requirement. Additionally, TR

86-2 provides guidance with respect to certain procedural issues not

addressed by the statute and the Department's view of good faith

compliance in the absence of regulations. First, TR 86-2 states that

sending a notice by first-class mail to the last known address of a

covered employee and his or her spouse (if any) would evince a good

faith effort at compliance. Second, TR 86-2 states that, if a

spouse's last known address is the same as the covered employee's, a

single mailing addressed to both would be considered to be in good

faith compliance with the requirement set forth in 606(a)(1).

Finally, TR 86-2 states that if an employer (or plan administrator)

determines that a spouse no longer resides with the covered

employee, good faith compliance could be achieved by a separate,

first-class mailing to the last known address of the spouse.

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(b) Notice of Qualifying Event. Section 606 (a)(2) and (a)(3)

require that the plan administrator of a group health plan be notified

that a qualifying event has occurred. The nature of the qualifying

event determines whether this notice obligation falls on the employer

of a covered employee or on the covered employee or qualified

beneficiary. If the qualifying event is the death of the covered

employee, the termination or reduction of hours of the covered

employee's employment,12 the covered employee's becoming

entitled to Medicare, or a bankruptcy proceeding of the employer,

section 606(a)(2) requires the employer of the covered employee to

provide notice of the qualifying event to the plan administrator. The

employer must provide this notice within 30 days of the date the event

occurs.13 If the qualifying event is the divorce or legal

separation of the covered employee or a dependent child's ceasing to be

a dependent under the terms of the plan, section 606(a)(3) requires the

covered employee or qualified beneficiary to provide the notice of

qualifying event to the plan administrator.14 The covered

employee or qualified beneficiary must provide this notice within 60

days of the date the qualifying event occurs.15

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\12\ In the case of a multiemployer plan, the requirement that

the employer notify the plan administrator of the termination or

reduction in hours of the covered employee's employment is satisfied

if the plan provides that the plan administrator will determine the

occurrence of such a qualifying event.

\13\ If the plan is a multiemployer plan, this notice must be

given within the time period set by the plan.

\14\ Prop. Treas. Reg. Sec. 1.162-26, Q&A 33, states that this

notice is to be provided to the ``employer or other plan

administrator.''

\15\ Prop. Treas. Reg. Sec. 1.162-26, Q&A 33, states that if the

notice is not sent to the employer or other plan administrator

within 60 days after the later of the date of the qualifying event

or the date that the qualified beneficiary would lose coverage, the

group health plan does not have to offer the qualified beneficiary

continuation coverage.

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(c) Notice of Right to Elect Continuation Coverage. Section

606(a)(4) requires a plan administrator to notify qualified

beneficiaries of their right to elect continuation

coverage.16 This notice must be provided within 14 days of

the date on which the administrator receives the notice that a

qualifying event has occurred.17 Pursuant to section 605(1),

a qualified beneficiary must be provided a period of at least 60 days,

beginning on the later of the date of the loss of coverage due to the

qualifying event or the date the notice of the right to elect

continuation coverage was sent, within which to elect continuation

coverage.

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\16\ Advisory Opinion 90-16 (May 3, 1990) states that the

administrator of a group health plan cannot be relieved, by

delegation, contract, or otherwise, of responsibility for providing

the notice required by section 606(a)(4).

\17\ In an information letter dated April 11, 1995, the

Department stated that, in cases in which the employer of employees

covered by a group health plan is also the plan administrator, both

the 30-day notice period for the employer's notice of a qualifying

event and the 14-day period for the administrator's notice of the

right to elect continuation coverage would continue to apply.

Accordingly, an employer who is also the plan administrator has a

maximum period of 44 days from the date on which the qualifying

event occurred to provide such notice.

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(d) Social Security Disability Notice. Section 602 provides that,

if a qualified beneficiary becomes disabled, as determined under Title

II or XVI of the Social Security Act, at any time during the first 60

days of continuation coverage, he or she is entitled to a total of up

to 29 months of continuation coverage, rather than only 18 months of

continuation coverage. Section 606(a)(3) provides that, in order to

obtain the 11-month extension, such a qualified beneficiary must notify

the plan administrator of the determination of disability within 60

days after the date of such determination. Section 602 also requires

that this notice be provided before the end of the original 18-month

period of continuation coverage. The qualified beneficiary must also

notify the plan administrator of any final determination that the

qualified beneficiary is no longer disabled. This notice must be

provided within 30 days of the date of such determination.

[[Page 49896]]

3. Statutory Sanctions for Failure to Comply With COBRA Notice

Requirements

The COBRA provisions impose sanctions for failure to comply with

certain of the notice requirements of ERISA section 606.

a. ERISA Section 502

Section 502(a)(1)(A) of ERISA permits participants and

beneficiaries to bring a civil action for the relief provided in

section 502(c). Section 502(c)(1) provides that a plan administrator

that fails to provide an initial notice or a notice of the right to

elect continuation coverage may, in the court's discretion, be held

liable to the participant or beneficiary for up to $100 per day from

the date of the failure to provide notice and for any other relief that

the court deems proper.

b. Code Section 4980B

Code section 4980B imposes excise taxes on the

employer,18 and, in certain circumstances, a person (other

than an employee) who is responsible for administering or providing

benefits under the plan and whose act or failure to act caused the

failure, for the failure of a group health plan to meet any of the

requirements of the COBRA provisions, including the relevant notice

requirements. Pursuant to section 4980B(b)(1), the amount of the tax on

any failure with respect to a qualified beneficiary is $100 per day

19 for each day of non-compliance. Code section 4980B(b)

establishes a number of standards relating to minimum and maximum

amounts of tax and specifies situations in which the tax will not be

imposed.

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\18\ In the case of a multiemployer plan, the tax is imposed on

the plan.

\19\ If there is more than one qualified beneficiary with

respect to the same qualifying event, the maximum amount of tax that

may be imposed on all failures on any day with respect to such

qualified beneficiaries is $200.

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4. Health Insurance Portability and Accountability Act (HIPAA)

HIPAA, which was signed into law on August 21, 1996, made certain

substantive changes to the COBRA provisions. Those changes became

effective January 1, 1997, regardless of the date of any qualifying

event. Among other changes,20 HIPAA amended section

602(2)(D)(i), with respect to circumstances under which a group health

plan may cease providing continuation coverage to a qualified

beneficiary because that qualified beneficiary has become covered under

another group health plan, to reflect the changes made by HIPAA with

respect to preexisting condition exclusions and limitations.

Specifically, the COBRA provisions mandate that, if the new plan limits

or excludes coverage for any preexisting condition of the qualified

beneficiary, the plan providing continuation coverage cannot cease

making continuation coverage available solely due to the coverage under

the new plan. However, HIPAA provides that, if the new group health

plan limits or excludes coverage for preexisting conditions, but those

limits or exclusions would not apply to or would be satisfied by a

qualified beneficiary under the HIPAA rules limiting pre-existing

coverage exclusions, the plan providing continuation coverage may cease

providing it. As a separate matter, HIPAA provides that the amount of

an individual's ``creditable coverage'' (see footnote 21) must include

any period of time during the relevant look-back period for which the

individual was covered by a group health plan as a result of the

individual's having elected continuation coverage.

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\20\ As described in footnotes 2 and 4, above, HIPAA clarified

the definition of ``qualified beneficiary'' and the scope of the 11-

month extension for disabled qualified beneficiaries. In addition,

section 421(e) of HIPAA required group health plans subject to COBRA

to notify individuals who have elected continuation coverage no

later than November 15, 1996, of the changes to COBRA enacted by

HIPAA. The Department issued Technical Release 96-1 on October 15,

1996, to inform employers and plan administrators of the changes in

the COBRA rules made by HIPAA and of their obligation under HIPAA to

notify qualified beneficiaries of such changes. The Department, as a

matter of enforcement policy, deemed that supplying qualified

beneficiaries with a written copy of the information contained in TR

96-1, or with a copy of TR 96-1, would constitute compliance with

the notice requirement contained in section 421(e) of HIPAA if the

information was sent to each qualified beneficiary by first class

mail at the last known address of the qualified beneficiary by

November 1, 1996.

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5. Interim HIPAA Regulations

On April 8, 1997, the Department, in conjunction with the IRS and

the Health Care Financing Administration of the Department of Health

and Human Services, published in the Federal Register interim rules and

a proposed rule implementing certain provisions of HIPAA (62 FR 16894).

The Department's interim regulation relating to certificates of

creditable coverage,21 29 CFR 2590.701-5 (62 FR 16946,

16947), provides that a qualified beneficiary is entitled to a

certificate both at the time that coverage would be lost in the absence

of continuation coverage and, if the qualified beneficiary has elected

continuation coverage, at the time that the continuation coverage

ceases. In addition, in cases in which the person is entitled to elect

continuation coverage, the first certificate must be furnished no later

than the time a notice of the right to elect continuation coverage is

required to be provided. The second certificate, after continuation

coverage ceases, must be provided within a reasonable time after

continuation coverage ceases.

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\21\ Pursuant to ERISA section 701, which was added by HIPAA,

certificates of creditable coverage are required to be provided to

participants and beneficiaries under group health plans under

certain circumstances. These certificates serve to establish a

participant's or beneficiary's period of ``creditable coverage,''

which will reduce or eliminate the period for which a group health

plan can limit or exclude coverage of a preexisting condition of

such participant or beneficiary.

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B. Circumstances Suggesting a Need for Regulatory Guidance

As discussed herein, the COBRA provisions of ERISA impose

obligations on employers, plan administrators, plan participants, and

qualified beneficiaries regarding disclosure of information through

notices and the ensuing right to elect continuation coverage. Section

606 of ERISA provides a statutory framework within which these notices

have significance as a means of providing affected parties with

adequate notice at appropriate times of the rights granted under the

statutory scheme. The delivery of notices also delineates limited time

periods during which such rights must be exercised. Failure to comply

with any of the notice requirements carries consequences for the party

failing to provide notice, whether in the form of potential liability

to provide coverage under the group health plan, sanctions imposed on

employers or plan administrators, or a loss of coverage or an

opportunity to elect continuation coverage on the part of qualified

beneficiaries. The Department believes the following factors suggest a

possible need for guidance concerning the COBRA notice provisions.

First, a significant amount of the relevant litigation that has

occurred since enactment of the COBRA provisions has involved failures

or alleged failures to comply with the notice

requirements.22 Second, many of the numerous requests that

the Department has received from participants for assistance with the

COBRA provisions have involved

[[Page 49897]]

allegations that employers' and plan administrators' notices have been

not forthcoming or have been inadequate or confusing. Third, the COBRA

provisions have been amended several times since publication of TR 86-

2, reducing its value as a model for good faith compliance. Fourth, the

obligations imposed on group health plans by HIPAA and other

legislation with respect to coordination of continuation coverage with

other statutory rights have further increased the importance of proper

implementation of the COBRA notice provisions. For these reasons, the

Department believes that regulatory guidance clarifying the notice

requirements may aid employers and plan administrators in complying

with the COBRA notice requirements and may also provide participants

and beneficiaries with a better understanding of their rights and

obligations.

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\22\ See, e.g., Underwood v. Fluor Daniel, Inc., No. 95-3036

(4th Cir. 1997); Stanton v. Larry Fowler Trucking, Inc., 52 F.3d 723

(8th Cir. 1995); Bixler v. Central Pennsylvania Teamsters Health &

Welfare Fund, 12 F.3d 1292 (3rd Cir. 1993); Meadows v. Cagle's,

Inc., 954 F.2d 686 (11th Cir. 1992); Kidder v. H&B Marine, Inc., 932

F.2d 347 (5th Cir. 1991); Truesdale v. Pacific Holding Co./Hay Adams

Division, 778 F. Supp. 77 (D.D.C. 1991).

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C. Issues on Which Information is Requested

To assist the Department in assessing the need for guidance

concerning the COBRA notice requirements, the Department invites

interested parties to submit information relating to whether the

Department should promulgate standards with regard to the content of

the notices, the delivery and timing of these notices, and the

consequences of either satisfying or failing to satisfy the notice

requirements, and what such standards should be.

In order to assist interested parties in responding, this notice

contains a list of specific questions the answers to which the

Department believes would be helpful in considering guidance in this

area. It is requested that the public, in responding to specific

questions presented by this Notice, refer to the question number listed

in this Notice. Reference to the appropriate question number will aid

the Department in analyzing submissions.

The questions provided herein may not address all issues relevant

to the development of the regulation. Accordingly, the Department

further invites interested parties to submit additional comments on any

other matters that they believe may be pertinent to the Department's

consideration of guidance on this subject.

Specific areas with respect to which the Department is interested

include:

I. Initial Notice to Covered Employees and Spouses

A. What information should be required to be included in the

initial notice to covered employees and spouses?

B. Would ``model'' language with respect to any of the required

information be helpful?

C. Should the Department provide an updated, revised ``model''

notice to replace that published in TR 86-2?

D. In TR 86-2, the Department indicated that furnishing one initial

notice to participants and spouses residing at the same address would

be adequate. Should the Department continue to view this method of

furnishing information to a spouse residing with a participant as

sufficient?

II. Notice of Qualifying Event

A. What information should be required to be included in the notice

of qualifying event?

B. In what form should this notice be required to be provided?

C. Should the required information or the required form in which

this information is conveyed vary depending on whether the notice is

being given by the employer or by the covered employee (or qualified

beneficiary)?

D. Should the Department provide rules under which notice of a

qualifying event is deemed to have been given when an employer is also

the plan administrator of a group health plan, or should some formality

of communications be required under such circumstances?

E. Should the Department provide a ``model'' notice of qualifying

event for use by employers and qualified beneficiaries?

F. What, if any, problems have arisen in connection with compliance

with this notice requirement?

III. Notice of Right to Elect Continuation Coverage

Section 605 of the COBRA provisions provides that the election

period during which a qualified beneficiary may elect continuation

coverage must extend for at least sixty days, measured from the later

of the date on which coverage otherwise would terminate or the date on

which the notice of the right to elect continuation coverage is sent to

the qualified beneficiary. The plan administrator's provision of the

notice of right to elect continuation coverage, therefore, initiates

the qualified beneficiary's right to elect and begins the running of

the period of that right. The Department, accordingly, believes that

the notice of right to elect continuation coverage must provide the

qualified beneficiary with the information relevant to the exercise of

the right. The following questions should be considered in light of

this concern.

A. What information should be required to be included in the notice

of the right to elect continuation coverage?

B. For example, should the notice be required to include:

1. A description of the continuation coverage that the qualified

beneficiary is entitled to elect;

2. A description of the period over which such continuation

coverage would be provided;

3. A description of the premiums that the qualified beneficiary

would be required to pay, including the manner in which such premiums

were calculated, the dates on which payment would be due, the address

to which payment should be sent, and the consequences of nonpayment;

4. An explanation of the election process, including the period of

time within which an election can be made, the consequences of electing

or failing to elect continuation coverage, and the possibility of

rescinding an election; or

5. An explanation of any rights that might arise to cause an

extension of the maximum period of continuation coverage (such as with

respect to any qualified beneficiary who is determined to be disabled

within the first 60 days of continuation coverage) and the notice

obligations imposed on any such qualified beneficiary?

C. Is there other information that should be required to be

included in the notice of right to elect continuation coverage, such as

the significance of electing continuation coverage for rights granted

by HIPAA or the FMLA?

D. Should significant information relevant to the decision whether

to elect continuation coverage be required to be provided in the

notice, or should inclusion of the information in the summary plan

description (SPD), with a reference in the notice to the relevant

information in the SPD, be deemed adequate?

E. Should the Department provide a ``model'' notice of right to

elect continuation coverage or ``model'' language on selected subjects

for use in the notice?

IV. Social Security Disability Notice

A. What, if any, problems have covered employees, qualified

beneficiaries, employers, or plan administrators encountered in

obtaining the 11-month extension or in administering the provisions

granting the right to the 11-month extension, particularly with respect

to satisfying the notice requirements imposed by sections 602(2)(v) and

606(3)?

[[Page 49898]]

V. Other Issues

A. What are the practical and appropriate means (e.g., written

notices, electronic media, and/or oral interviews) through which the

COBRA notice requirements should be satisfied?

B. What kinds of procedures should or may plan administrators

establish to permit qualified beneficiaries to establish their

entitlement to extensions of the period of continuation coverage, such

as through the occurrence of second qualifying events or as a result of

disability determinations?

C. What administrative procedures have plan administrators adopted

to provide additional notices or information not expressly mandated in

the COBRA provisions, but necessary or useful in the orderly

implementation of continuation coverage requirements, such as to

explain changes in the coverage provided under the group health plan

(including changes in the issuer or service provider), to make

available open enrollment or election periods provided under the plan,

to enforce due dates for continuation coverage premiums, or to

implement the termination of continuation coverage and make available

any conversion options provided under the plan?

All submitted comments will be made part of the record of the

preceding referred to herein and will be available for public

inspection.

Signed at Washington, DC, this 17th day of September, 1997.

Olena Berg,

Assistant Secretary for Pension and Welfare Benefits, U.S. Department

of Labor.

[FR Doc. 97-25240 Filed 9-22-97; 8:45 am]

BILLING CODE 4510-29-P