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    Summary Plan Description

    Does the Summary Plan Description satisfy COBRA Initial Notice requirement?

    Maybe. Although COBRA information must be included in the SPD (see below for more), many employers hand deliver the SPD to the employee. This might satisfy COBRA's Initial Notice requirements as long as there was not a covered spouse. If the employee covered their spouse, a separate notice would need to be sent.

    Employers should maintain a consistent method of COBRA notice delivery. Hand delivering the Initial Notice (as part of the SPD) to employees with single coverage, and sending notices via mail to employees with spouse and dependent coverage may end up causing confusion for administrators. COBRA has consistently affirmed first class mail with proof of mailing as sufficient.

     

    Planning Pointer:

    Send all COBRA Notices the same way (first class, certified, UPS, FedEx are all acceptable). Avoid hand delivery of notices, especially if spouses are also covered.

     

    COBRA Information to be included in the SPD

    The COBRA rights provided under the plan must be described in the plan’s summary plan description (SPD). The SPD is a written document that gives important information about the plan, including what benefits are available under the plan, the rights of participants and beneficiaries under the plan, and how the plan works.

    ERISA requires group health plans to give you an SPD within 90 days after you first become a participant in a plan (or within 120 days after the plan is first subject to the reporting and disclosure provisions of ERISA). In addition, if there are material changes to the plan, the plan must give you a summary of material modifications (SMM) not later than 210 days after the end of the plan year in which the changes become effective; if the change is a material reduction in covered services or benefits, the SMM must be furnished not later than 60 days after the reduction is adopted. A participant or beneficiary covered under the plan may request a copy of the SPD and any SMMs (as  well as any other plan documents), which must be provided within 30 days of a written request.