CPM Benefits Enrollment & Deductions 3

Question 1

Under COBRA, how long must continuation coverage be offered to a qualified beneficiary who loses coverage due to voluntary termination?

Accepted Answer

18 months

Answer

COBRA requires 18 months of continuation coverage for qualified beneficiaries who lose coverage due to termination of employment or reduction in hours.

Question 2

An HSA-eligible employee can make contributions only if they are enrolled in which type of health plan?

Accepted Answer

A High-Deductible Health Plan (HDHP)

Answer

To contribute to an HSA, an individual must be covered by an HDHP and cannot be covered by any non-HDHP health coverage.

Question 3

Employee payroll deductions for group-term life insurance premiums on coverage up to $50,000 are:

Accepted Answer

Pre-tax and excluded from gross income

Answer

Employer-provided group-term life insurance up to $50,000 is excluded from an employee's gross income and is not subject to income tax or FICA.

Question 4

A new hire must be offered HIPAA special enrollment rights if they declined health coverage at hire and later:

Accepted Answer

Experience a loss of other health coverage

Answer

HIPAA requires plans to allow employees who lose other coverage to enroll in the employer's plan outside of open enrollment within 30 days of losing coverage.

Question 5

When processing a mid-year Section 125 plan change, payroll must verify that the change is:

Accepted Answer

Consistent with a permitted election change event under the IRS regulations

Answer

IRS regulations under Section 125 restrict mid-year election changes to specific permitted events such as changes in status, cost, or coverage.

(CPM) Certified Payroll Manager Practice Test

(CPM) Certified Payroll Manager Practice Test

CPM Benefits Enrollment & Deductions 3