Is It Really A COBRA Event?

domer

We have about 40 employees who don't work in the summer (classroom staff). In the past they have always COBRA'd. I feel this is an unnecessary burden to us all and by simply making a few changes (i.e., policy to read eligible in summer months, etc.)we could avoid all of the paperwork and confusion. I've talked to others and get mixed reviews. Some believe I must offer COBRA b/c there has been a qualifying event. My argument is there is no qualifying event if they still qualify for the plan (sans employer contribution in the summer, though). Sage advise on this?

Beave

Maybe it's just me today but I'm not understanding what the employer is doing. IF the employer is providing the insurances throughout the summer months, then there is no qualifing event. If the employer is NOT providing the health insurance and the employees have been dropped from coverage for the summer months, at the effective date of coverage termination, you have a qualifing event and MUST offer the COBRA option effective the date of the coverage termination.

domer

The SPD and policy read "must work 20 or more hours to qualify for the group insurance". If a change is made to take out that language for this group of people, I say no qualifying event. I seem to be getting a lot of resistance, however, from others. Make sense?

njjel

Who would pay for the premiums during the summer (when I assume the ee's are not working)? Are you merely trying to avoid the paperwork issue? If so you could run into a problem as the law states that COBRA must be offered and technically you would not be offering COBRA but letting the insurance company assume they were still working and allowing the ee to pay for their insurance. However, if the company pays the premium for the ee as a benefit and they elect to continue to do so during a leave of absence, I don't see where a complaint would be filed.

domer

Er pays premiums based on # of hours worked. These employees during the summer would have no er contributions - we would take out their premiums during the 9 months they are actively working. They would not lose coverage - they would be allowed to stay on the plan like normal just no contributions would be made on their behalf. Make sense?