Cobra

mrsbowden

Okay you COBRA buff's....I have a question...if we administer our own COBRA and we have fail to discontinue someones COBRA coverage even after their allotted time has elapsed and then some (and NO do not qualify for disability so they should not still be on the COBRA coverage). Are we required by law to give them an extended period of time for notice, since they have not recieved a notice of cancellation and have contiued to utilize this benefit. Or can we just sever their coverage (by letter) and how do we explain the long period of time they have been on COBRA and should not have been.

AND believe it or NOT this is not my company. A friend that is a Generalist asked me this over the weekend so now I am curious..any bites x:-)

Pork

MSBOWDEN: FIRST QUESTION TO GET ANSWERED; Does the offering letter also have a statement which says, "any failure to make timely premium payment received prior to the 1st day of the next month is an automatic cancellation of coverage!"? If you find that clause in your offering letter then the COBRA coverage is automatic cancelled.

I doubt that you will be able to get back any money paid on claims as a result of the companies' failure to administer the plan, accordingly. 2nd question: Surely, there is a third party administrator, if so the expense for failure to administer the plan and COBRA might be shifted to the third party administrator. If none, guess what the plan is responsible for their on mistakes.

In no instant should the plan not exercise their right to cancel the COBRA coverage; do not let the x-ee make back payments and remain in the plan. The persons suffering the damages is the total members of the plan in premium payment. If the plan was not properly administered by the company then these expenses should be taken out of the total and not computed as the total cost in order to determine premiums payment for the next year.

Interesting keep us posted on the outcome!

PORK

juju

This is interesting. I read this a bit differently. The way I understood it was that the ex-employee was entitled to 18 months of COBRA (for example) and the employer didn't remember to term their coverage until, say, 24 months. I didn't think it was related to whether or not the ex-employee paid or not. Could you please clarify?

Pork

JuJu: I re-read and your posting and reading is certainly more inteligent than mine. However, bothyour reading and my reading are in concert and feeds to the questions, I posted. COBRA offers must have a "Sunset or cancelation date" be it one month or 18 months. Then when the cancelation event hits it is automatic. 2ndly, the remainder of my post is also valid based on the circumstances, which we were not told in the original posting!

I look forward to reading MsBowden's reflection on our post!

PORK

mrsbowden

JuJu and Pork,
Thank you both for the great insight...JuJu you were right on the money! It wasn't a case of the employee not paying the premium. It was a case of the er not terming the coverage after 18months.

Which I am amazed at the fact the someone, would be able to make this type of premium for 18 months more less 24 months.

Pork

MrsBowden: Thanks your friend must immediately read the details of the offer letter. Without clearily understanding what the letter says, which becomes the employer's words on which they react to any situation. I too am surprised at the cost plus 2% for COBRA coverage, unless there is a continuing medical reason to sustain the coverage for whatever reason by the X-ee. Our premium for a family coverage is over $1000.00 per month paid in advance by the 25th day of the month or the policy coverage is cancelled. Any use of the coverage after the "drop dead" date is denied and the responsibility of the X-ee for payment to the medical unit used.

How was this situation discovered? I can see a suspense system failing for a short haul, but never for greater than a week. My payroll clerk and myself would be fired or be asked to pay the damage to the company for our poor performance or resign.

PORK

mrsbowden

Pork I completely agree and I am not sure what their consequences will be for missing this. I will try and get the details of the offer letter this week. Maybe there is a kick out in there somewhere and they have just failed to take the time to read it carefully in all of the mess.