Q&A: Steps to Take After Missing COBRA Continuation Deadline

Question:

We received an email from a former employee asking how to sign up for COBRA continuation coverage. This was about four months after he left our company, which is well after the deadline for him to elect COBRA. He claims that he never received an election notice, but our COBRA administrator says that they sent him the necessary paperwork in a timely manner. What is our obligation at this point?

Answer:

Individuals who lose coverage due to a qualifying event and want to enroll in COBRA have 60 days after coverage ends or the election notice was provided (whichever is later) to elect coverage. So, your first step is to verify whether the election notice was properly and timely sent to this former employee.

Employers are required to mail election notices to COBRA-eligible individuals at their last known address.

I would start by asking the administrator:

1. What address was the notice sent to? It’s possible the employee notified you of an address change, but the administrator’s system wasn’t updated. In this case, the administrator may need to resend the notice and allow the employee to elect coverage.
2. If the address appears to be correct, find out whether it was returned to the administrator as undeliverable. At least one court has said employers should resend the notice if they have reason to suspect during the election period that it was sent to an incorrect address. An undeliverable message from the post office could provide a “reason to suspect.” You might want to consider contacting the individual to see if he can provide an updated address.
3. I would also ask the administrator whether they received proof of delivery and, if so, on what date. If they did, or if it otherwise appears the notice was delivered to the individual’s last known address, then you may not need to take any additional actions.

Because there are many variables and this is not a clear-cut area of the law, I recommend discussing all possible outcomes with your attorney before deciding how to proceed.

Not a client of The Miller Group? Connect with one of our employee benefits advisors to learn how our compliance team can help you stay on track and confidently meet your obligations.