What Happens to Benefits When an Employee Is Terminated

Purpose

Terminating an employee ends their benefit enrollments in UZIO and notifies the people who need to know. What happens to the coverage itself, and who issues continuation-of-coverage notices, is decided outside UZIO by your plans, your carriers, your broker, and your COBRA administrator. This article sets out which part UZIO does, which part is yours, and what to check so nothing falls through the gap.

Who needs this: users whose role includes permission to terminate employees, and users with Benefits access. Both are typically held by the Employer Administrator, and a custom role can grant either.

What UZIO does when you process the termination

• Ends the employee's benefit enrollments, with a coverage end date recorded for each plan.
• Emails you a confirmation listing each plan the employee was enrolled in, its product category, who was covered, the premium amount, and the coverage end date.
• Notifies your broker that the employee was terminated and when their coverage ends.
• Emails the employee, where you chose to notify them during termination. The email tells them their employment status changed, that their UZIO access stays active, and which coverages are ending and when. A Death termination never sends this email.
• Stops the benefit deductions that ride on those enrollments once coverage has ended.

Check the result in Monitoring Enrollments, where the employee's enrollments now carry an end date. If you run payroll in Paycor, the Paycor integration sends $0 amounts for the mapped codes from the benefit end date.

What your broker and carriers do

• Coverage end dates and carrier notification. When the carrier actually terminates the coverage, and how the carrier is told, is coordinated through your broker. Confirm that route with them rather than assuming the termination in UZIO reaches the carrier on its own.
• Anything the employee must be offered. Continuation of coverage, conversion options, and the paperwork that goes with them sit with the carrier and the broker.

COBRA

UZIO does not administer COBRA. It does not generate COBRA notices, track elections, or bill premiums. Those live with a dedicated COBRA administrator.

UZIO can pass qualifying-event data to one. The WEX COBRA integration (formerly Discovery Benefits) is available as an add-on service in the Integrations marketplace and is enabled per account. Where it is switched on, UZIO sends enrollment records for affected employees and dependents after a COBRA qualifying event, and produces the initial general-rights notice file as well as records of the affected people. Qualifying events include termination of employment, death of an employee, and an employee becoming eligible for Medicare. Customers also use other COBRA platforms, such as Anvi and CPI. Ask your account manager what is connected on your account before you rely on any hand-off happening automatically.

A life status change can also make someone COBRA-eligible without a termination. See Managing Life Status Changes.

Checklist for a departure

1. Process the termination in UZIO with the correct termination date. See Terminating an Employee.
2. Read the confirmation email and note the coverage end date for each plan.
3. Tell your broker, unless you have confirmed they are notified automatically, so that carrier termination and any continuation paperwork start on time.
4. Confirm the qualifying event has reached your COBRA administrator, by the integration or by hand.
5. Check the final paycheck: the benefit deduction lines, the PTO payout, and the timing against your state's deadline.
6. If the employee's username was their work email, change it to a personal address so they keep access to pay stubs and W-2s.

Related articles

• Terminating an Employee
• Final Paycheck Laws by State
• Automatic PTO Balance Payout on Employee Termination
• Monitoring Enrollments
• Managing Life Status Changes