COBRA Administrator denies coverage!

1. EE fired 12-6-2002 .
2. EE under health coverage with Plan A during December 2002.
3. Company gave former EE notice of intent to switch coverage to Plan B
effective 01-01-2003, by letter sent 12-9-2002
4. Company sent letter to former EE, notifying of COBRA rights with Plan B,
by letter sent 12-9-2002
5. Company completed COBRA forms and sent to outside COBRA administrator in
mid-January 2003. Then today....
6. COBRA administrator notified former EE that a) there could be no coverage
under Plan A because Company no longer had that Plan, b) that there could be
no coverage under Plan B because former EE was never enrolled under Plan B
while working with the Company.

What should I do???



  • 4 Comments sorted by Votes Date Added
  • I can't quote chapter and verse, but I think if the EE was [u]covered[/u] under your group plan and the group plan changed, the EE is still eligible for COBRA. The question is not whether the EE was working, but if he was [u]covered[/u] before the change took place and still within his 60-day election period. The company, not the PA, will pay the ultimate price when the EE challenges the decision.
  • If the employee has contacted you, tell him or her that you will get investigate and respond, then find someone who knows COBRA inside and out and get a second opinion or third opinion. If you think that the second opinion is correct go back to the administrator and tell them to reverse their decision, then change administrators.
  • Cheri,
    I agree totally with BSA. The employee could choose coverage under A and if A is superceded by B, then employee would be covered by B.
    Get someone higher up in your Cobra Administrator to try and see the logic of this.
    You will save your company beaucoup money now instead of fighting a long, drawn out lawsuit.
  • I can't quote the exact verbage either, but I don't believe that the employee can be penalized because the company decided change plans during his/her election period. I have serious doubts about your COBRA administrator./:)
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