When employment ends, whether voluntary or involuntary, the termination date must be documented for ACA.
Full-time Employee Ends Employment – Fully Insured
For full-time employees who term during the year, you need to document their Term Date and the Coverage End Date:
- Term Date: This should be the employee’s last day of work.
- Coverage End Date: This will vary, depending on whether your company offers coverage through the end of the month, or ends coverage immediately. IMPORTANT NOTE: Even if the employee has waived coverage, it is still important to enter a Coverage End Date to document when the Waived status ended.
- COBRA: Fully-insured employers do not need to document COBRA coverage due to a termination.
Full-time Employee Ends Employment, Elects COBRA – Self Insured
If your company is self-insured,[1] and the employee elects COBRA coverage after the term date, you must document that information:
- Term Date: The Term Date should match for both entries.
- Coverage Type Dates: The COBRA coverage should begin immediately following the end date for the employee’s traditional coverage.
- COBRA Waived: If the employee waived COBRA benefits, you do not need to list it in your spreadsheet. The second line above would not be necessary.
- Coverage Type: If the employee elected COBRA benefit after termination, enter “COBRA Not Employed.” If the employee waived COBRA benefits, DO NOT enter a COBRA line on your spreadsheet.
Next Step: Documenting Rehires
[1] If you have a fully-insured plan, you do not need to report your employee’s COBRA decision here. Your insurance carrier will report that information for you.