The Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985 requires by law that organizations of 20 employees allow their employees and covered dependents to continue to receive group health benefits after experiencing "qualifying events", such as termination of employment, reduction of work hours, employee´s death, or divorce.
There can be a lot of confusion around time frames for receiving benefits that need to be reviewed and monitored for compliance reasons. For example, there are set deadlines for notifying recipients, as well as grace periods for payments, and payment continuation time frames.
In addition, there are penalties that employers must face for noncompliance. For example, if an employer does not comply with the law, a nondeductible tax of $100 per day per qualified beneficiary can be imposed on the employer! Therefore, although it may appear easy to avoid COBRA compliance, there are severe consequences if a company does not comply. BASIC COBRA Administrator for Windows helps companies keep track of their COBRA recipients to ensure compliance with the law. Let´s take a look at what it does...
What is BASIC COBRA Administrator for Windows (BCAW)?
BASIC COBRA Administrator for Windows is a software program that manages your company´s COBRA-recipient employee information.
Since COBRA compliance is mandated by law, it is important that your company is more than simply aware of what the law says; it must make efforts to ensure that its actions are legally compliant. Therefore, BCAW not only directly ensures that your COBRA participants are properly managed and administrated, but also indirectly ensures that your company is legally compliant.
This feature outlines for beginning users the most important COBRA events that you will need to keep track of. This is a great feature that helps beginners prioritize their COBRA administration tasks, such as when to send conversion notifications, reminding users when to terminate individuals for non-payment, entering new insurance rates, etc.
Qualifying event letters
Termination for nonpayment
Conversion notification
Enter new insurance rates
One of the key features for HR departments is the ability to create and produce clear and easy to understand reports. With COBRA administration, accurate documentation is a priority. Therefore, BCAW has added several types of monthly reports to assist you in documenting your COBRA compliance.
- Initial Tracking Report - this acts as your main data retrieval report and prints your employees´ names, address, initial notice dates, etc.
- Qualifying Event Tracking Report - keeps track of your employees "qualifying events", their dates, separates overlapping events, etc.
- COBRA Tracking Report - displays past COBRA participants, their "qualifying events", related insurance plans, timeframes, and completion dates.
- Payment/Collections Reports - indicates type of coverage, monthly premiums, paid through dates and amounts owed.
- Termination Reports - detail which employees and when they should be terminated from receiving group medical benefits
- IBM PC 3865X, compatible or higher grade computer
- Minimum 4 megabytes RAM (Random Access Memory)
- Hard disk with 3mb available memory, color monitor and/or graphics card
- Windows Operating System, v. 3.1 or higher
$595.00 (please see an important note in the Overall Evaluation about pricing)
They provide users with a toll-free number to call for BASIC support.
However, there is little information provided on the site regarding the product specifically. And there is no apparent support section on their site.
Users can also attend Seminar Training to help them with their general COBRA compliance programs.
BASIC´s website provides many answers to your most common benefits and COBRA questions. They provide their own extensive and easy to understand listing of COBRA questions and also have a well-rounded listing of links that you can check out including:
30 Frequently Asked Compliance Questions
COBRA Resources Inc.
Child and Family Resources Inc.
The demo does take a little while to download. However, when you order the software, they will send you the program in the mail.
BCAW is formatted in the familiar Windows look and feel. Therefore, if you´ve used any Windows products before, such as Word or Excel, you´ll have the general understanding of how to navigate through BCAW.
BCAW is easy to understand and the fields are self-explanatory. There are a lot of ways that BCAW has attempted to make the program as easy to use as possible. For example, in the majority of the fields, drop-down menus give users the options for those fields which takes the guess work out of filling in those fields.
Also, BCAW also has somewhat "intelligent wizards" built into the system. What this means is that if your dates don´t comply or don´t "make sense" to BCAW, i.e., your inputted dates don´t match specified deadlines, a pop-up screen will appear, notifying you of the problem. Therefore, whether it´s proper date format or a conflict of specific deadlines, BCAW will indicate the error.
There did appear to be a slight glitch when you enter in a date ending the year "00" as the field automatically sets to 1900 instead of 2000. However, if you simply input 2000, instead of 00, the year will be correct.
A detailed manual is provided by BCAW when you purchase the software. This is extremely important for two reasons:
1) There is no help section built in to the program. There is a section under the Notifications menus called COBRA procedures that is similar to an index that outlines certain COBRA-specific terms and definitions. This does help clarify the COBRA process. However, there is no help menu, so a detailed manual is necessary.
2) BCAW feels that it is necessary to understand the law, your responsibilities, and potential liabilities in order to fully comply with it. Therefore, the manual helps explain what COBRA is and does, and what the necessary steps are to keep your company liability and lawsuit free.
We were not able to preview the manual that is sent to BCAW purchasers. However, one improvement that could be suggested is the integration of a built-in help menu or perhaps simply some additional guidance for those just beginning with the software, i.e. pop-up screens that tell you in detail what certain fields are used for.
Demonstration
When you first open up BCAW´s, you are greeted with a four-titled checklist. These four fields of information are necessary in order to use BCAW. This is a great feature of BCAW as it clearly outlines what information needs to be completed before users can continue with the program.
Initial Report generation is simple. You fill in the blanks as prompted by BCAW and after a few screens, a basic but complete letter of notification is ready for either editing or printing.
BCAW can print 9 different graphs and reports including:
Employee Time Frames,
COBRA Time Frames,
Plan and Premium Distribution graphs
Qualifying Event Reports
COBRA Tracking Reports
Both reports and graphs are simple to print and analyze; you simply click on the drop down menus, and choose the type of documents that you want produced.
BCAW has its own built-in word processor so when you want to print or edit your documents, there is no need to transfer information from BCAW to Word or
WordPerfect, for example; and the built-in word processor automatically pops up.
One of the best features of BCAW is the fact that it really has automated the COBRA compliance process and made things as easy as possible for users. Each of the drop down menus are simple to understand and straight forward. Individuals can either be identified using their SSN or by a drop down menu with their name
Overall Evaluation
There are two companies that sell this product, the developer, Cobra-Solutions, Inc. (www.cobra-solutions.com) and this reseller, BASIC. The product is exactly the same, however, there is a significant price difference: BASIC´s product is priced at $595, and Cobra-Solutions, Inc. is priced at $295. I´ll leave the decision making process up to you...
For the lower cost, the software is affordable and worth purchasing especially as it is "legally required". However, if you are already using an HRIS, there is a strong possibility that it may already contain a COBRA compliant module. You may first want to check, as there will be fewer integration problems with your own existing software. But for $295, this will be competitively priced with having to add an additional module to your HRIS.
An additional recommendation to purchasing this software is to take a look, not only at the prices offered by both sellers, but the support as well. There are differences between the levels of apparent support offered between the two companies as Cobra-Solutions, Inc. provides online support, product-specific FAQ´s, and a site assigned specifically for technical support.
Since there is no built-in help menu in the software, it is important that your company and BCAW user is aware of how COBRA works and what it is meant to do. This is one of the additional good things about BASIC´s site. There is a wealth of information provided on COBRA compliance and other links to which you can obtain more information. This is accessibility of information is extremely important, not just for understanding how to use BCAW, but for the well-being and compliance of your employees and organization.
BASIC stands for Benefits Administrative Services International Corporation. They provide services to over 2200 clients in almost 40 states and in Canada. Incorporated in 1989, BASIC has developed easy-to-administer systems that enable employers to set up and manage their own cafeteria/flexible benefit plans.
10528 Shaver Road,
Portage MI 49024
Tel: 800-444-1922
Fax: 616-327-0716