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COBRA termination too early - check lost in mail?

hr tracihr traci 55 Posts
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I notified a Cobra participant on June 3rd that her coverage was being terminated because her May premium was not received (or postmarked) by the end of the grace period (by 5/31).

I received a call from the participant on Monday, June 7th that she had sent the check before Memorial Day holiday. She checked with her bank and the check had not been cancelled yet, so she is assuming it is lost in the mail, or taking the really slow route (she lives about 15 miles away).

She is planning to drop off a check here today to cover last month. I do not have a reason to doubt that she sent the first check, but is there anything else I should do in this situation?

What is the average length of time past the grace period that you would terminate someone who hasn't paid?

Also, I had already cancelled her in Blue Cross' online system - I anticipate there will be difficulty in trying to reinstate a Cobra participant...

I would appreciate any feedback!
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Comments

  • 6 Comments sorted by Votes Date Added
  • BeaveBeave 263 Posts
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    I don't know traci, but the "lost in the mail" excuse sound a little lame to me. I would recomend a quick call to your insurance agent/rep to verify the acceptance of the reinstatement. The rep may be able to pull some strings that the on-line approach may not accept. Be careful of not setting a precidence with this that you may regret at a later date. I would question why they waited to mail just before a holiday with the next business day AFTER the deadline to terminate coverage. As for a grace period - the deadline is the deadline. As it is here, as of today, they would be eight days late ALREADY for THIS months premium. In other words, as of today, they would be LATE ALREADY for TWO months premiums. Good Luck.
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  • lnelsonlnelson 670 Posts
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    For our COBRA participants we ask for payment on the first of the month for that months coverage with a 10 day grace period.

    As far as Blue Cross I believe you should be able to reinstate the COBRA with little hassle on the On-Line service.

    Since she was pretty late in mailing why didn't she just drop it off to your office? 15 - 25 min. tops. Mail excuse is pretty standard when it gets forgotten.

    I would draft a letter stating that this will be the last time a late payment will be received.
    Have her sign the letter as acknowledgement.

    Lisa
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  • BalloonmanBalloonman 972 Posts
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    Of course you could tell her sorry, but you will reconsider once the payment she mailed is recieved, or she can bring it in to you once the post office returns it to her. Maybe the stamp fell off. Tell her certified mail return reciept, late in the future she will be cancelled, whether lost in the mail or not.
    My $0.02 worth!
    DJ The Balloonman
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  • hr tracihr traci 55 Posts
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    Thank you all for your input - She dropped off a check on 6/8, and the original check was recieved in the mail today (6/10), which will be applied to the next month's coverage. I appreciated the advice of notifying her that reinstatement will not be possible another time and to use certified mail. I did notify her by mail of these conditions. Thanks again!
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  • Don DDon D 9,834 Posts
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    If she lives 15 miles away, even at two bucks a gallon, it would make more sense for her to drop the checks off at your office each month than go through the hassle and cost of certified mail at the P.O.
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  • PearcePearce 70 Posts
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    I'm probably weighing in too late with too little, but we all know that every COBRA participant has a minimum of 30 days from the due date to render a payment. The date on the envelope is what counts and not the date that the post office gets around to delivering the payment. This person's check was apparently mailed timely. The way we handle our payments is that each payment stands alone and updates coverage only for the month or months represented by the payment. If this had been my COBRA participant her record in the system would have shown her as covered through the end of April until her May premium was received. When it was received (with timely postmark) the system would have been updated to show coverage through the end of May. We never "advance coverage" that is not already paid for. The middle of every month I check for payments not received for the prior month and then terminate coverage as appropriate.
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