COBRA issue - HELP!!!

Leslie

Are there any other reasons to deny COBRA besides gross negligence? Hypothetically (yeah, right!) there's an employee who has called off ill for more than two weeks and has not provided any doctor's notification. Rumor has it that he is working elsewhere while keeping him and his family on our medical benefits without paying the increased costs of COBRA. He paid medical premiums on Jan. 3, 10, 17, missed 24, will miss 31 and with no work this week, will miss Feb. 7. We're going to require him to present medical documentation taking him off work so we can "provide" him with FMLA. If he doesn't produce we will obviously term, but can we deny COBRA? and when can we term his medical insurance?

Gillian

If you terminate him the insurance will end whenever the plan says that it will - usually either the day of the termination or the end of the month. Gross negligence is the only reason to deny COBRA but remember that the definition of gross negligence is whatever a court were to decide if your decision is challenged - it's not worth it.

Theresa Gegen TX

I would not take the chance on denying cobra. First, you have only rumor that he has another job. If you find out for a fact that he does, and he has been lying about his absense, I would term. This should be investigated!!

Second, with COBRA he will have to pay the entire premium PLUS 2%; he may not be able to afford it, and if he has another job, he more than likely has a better option for insurance there.

Third, the risk of being wrong in your denial is LARGE: if he is denied COBRA, then something happens (like he is in a serious accident), the company may have to foot the bills.

Before denying COBRA, at a minimum meet with an attorney to review the facts and balance the costs in detail.

Good Luck!!