COBRA and ARRA...Oy Vey

Termed employee elects coverage under the second chance thing from ARRA. Coverage is then retro to 3/1/09 as per the guidelines. As a technicality (from my understanding of the COBRA lingo on the DOL website), March payment is due by 5/31, April by 4/30, and then all subsequent due by the first of each month. There is a minimum 30 day “grace period” for payments made after the initial payment (which itself had a 45 day grace period). She paid one payment. Am I correct in assuming that I can term her coverage for non-payment as I have not received either the March or May payments? If so, would her coverage actually terminate retro to 4/1 since she did pay for 1 month?


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  • If we count the payment she made in April (technically for April), she's made one payment total. It could be considered March's payment.
  • Unless you get a payment postmarked by 5/31 for April and May, I would say she is done. I would give it a few days to make sure nothing got held up in the mail, then I would cancel her for non-payment of premium.

    I assume these special case COBRAs have to pay the same as regular COBRAs. They have 60 days to decide and then 45 days to pay. So someone electing for January forward would have until March 1st to elect and then until April 14th to pay January. Then it (February, March and April) gets tricky. If I remember correctly (and that is a big IF), my example participant would have until May 14th to pay February, March and April and then until May 31st to pay May. Does anyone have more and better information? I am really rusty in this area.
  • Would her term date go retro to 4/1 since she only paid for 1 month?

    With ARRA it gets even hairier because they had to elect retro to 3/1 to get the subsidy and then had 45 days from the date of election to make payment (which is why the March payment was due at the end of May). I'm going to wait until Friday to send the form in case it is in the mail somewhere...though she lives in town and in town usually gets delivered within a day or two.
  • If her paperwork, etc, made it clear that her coverage started March 1st then her payment gets applied to March.
  • I agree that the payment made would be for the month of March. Then, she does have 30 days grace period so she has until the end of May to pay for her April premium. We outsource our COBRA through ADP (thank goodness!) but I still have to keep up with them because sometimes they let things slip through the cracks.

    Our insurance would only cover costs incurred for March, then they would reject any claims after that until I let them know the COBRA participant paid.

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