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Paychex services meet federal and state mandates requiring health care coverage continuation for employees and beneficiaries
Rochester, NY (August 16, 2006) - Paychex, Inc. today announced the addition of Paychex COBRA Administration to the company's suite of human resource services for small and medium-sized businesses. Paychex offers both COBRA and state continuation services, which meet federal and state mandates for the temporary continuation of health care coverage for employees and their families that would otherwise end because of certain qualifying events. Paychex COBRA Administration, available to Paychex clients as well as other businesses, also helps employers stay in compliance and avoid costly penalties that can be incurred.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) applies to employers with 20 or more employees and stipulates that most group health plan sponsors must give employees and their beneficiaries the chance to keep their health coverage, which they would otherwise lose for reasons including termination of employment, divorce, or death.
State continuation services apply to employers with 19 or fewer employees. Eighty percent of states require health insurance continuation for businesses with one or more employees. With Paychex COBRA Administration, Paychex will completely set up and maintain COBRA and state continuation programs.
"By relieving our clients of the tasks of notification, collection, remittance, and administration of their COBRA requirements, Paychex delivers a comprehensive service to both the employer and the separated employee," said Tony Tortorella, vice president of sales for Paychex Human Resource Services.
With Paychex COBRA Administration, Paychex will:
- Set up and maintain COBRA and state continuation programs.
- Send timely notices to qualified employees.
- Collect and remit participant payments.
- Track terminations.
- Help to comply with all COBRA-mandated programs.
- Answer questions via a toll-free customer service line for employers and employee participants.
While Paychex COBRA Administration is available to any employer that meets federal or state guidelines, Paychex payroll clients - both small and large businesses - benefit from the integration of the payroll and COBRA processes.
"With Paychex as the client's payroll and human resource services provider, the link between payroll and COBRA allows Paychex to be proactive with COBRA qualifying events, notifying both the employer and the employee," said Brad Flipse, vice president of sales for Paychex Major Market Services. "When an employee terminates, the system is alerted, and the COBRA process begins. We see that the necessary paperwork goes out to the employee, taking the burden off the employer."
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